Design, development and verification of the 30 and 44 GHz front-end modules for the Planck Low Frequency Instrument

We give a description of the design, construction and testing of the 30 and 44 GHz Front End Modules (FEMs) for the Low Frequency Instrument (LFI) of the Planck mission to be launched in 2009. The scientific requirements of the mission determine the performance parameters to be met by the FEMs, including their linear polarization characteristics. The FEM design is that of a differential pseudo-correlation radiometer in which the signal from the sky is compared with a 4-K blackbody load. The Low Noise Amplifier (LNA) at the heart of the FEM is based on indium phosphide High Electron Mobility Transistors (HEMTs). The radiometer incorporates a novel phase-switch design which gives excellent amplitude and phase match across the band. The noise temperature requirements are met within the measurement errors at the two frequencies. For the most sensitive LNAs, the noise temperature at the band centre is 3 and 5 times the quantum limit at 30 and 44 GHz respectively. For some of the FEMs, the noise temperature is still falling as the ambient temperature is reduced to 20 K. Stability tests of the FEMs, including a measurement of the 1/f knee frequency, also meet mission requirements. The 30 and 44 GHz FEMs have met or bettered the mission requirements in all critical aspects. The most sensitive LNAs have reached new limits of noise temperature for HEMTs at their band centres. The FEMs have well-defined linear polarization characteristcs.Comment: 39 pages, 33 figures (33 EPS files), 12 tables. Planck LFI technical papers published by JINST: http://www.iop.org/EJ/journal/-page=extra.proc5/1748-022

Overdrafts and Credit Rationing

A line of credit or overdraft is a common contingent lending contract that is an alternative to a fixed or fully drawn loan. The latter has received much attention in empirical and theoretical analyses while the former has received virtually none. In particular, much effort has been put into investigating credit rationing, which has been defined as occurring when a borrower wants a larger loan than is offered at the ruling interest rate. The meaning of credit rationing in a line of credit or overdraft regime is the subject of this paper. An overdraft is the right to overdraw an account, up to a specified maximum and over an agreed period after which time credit limits are reviewed. The borrower pays interest on the credit he uses, which is determined by him up to the maximum allowable. In such a system, the lender faces uncertainty from two sources. First, when the credit limit is established there is uncertainty as to how much credit will actually be used during the life of the credit arrangement. This is significant to the lender because he may have to find cash to cover unexpected fluctuations in realised usage of the credit line. Second, there is uncertainty concerning the borrower’s ability to replay the overdraft loan plus interest when the overdraft contracts terminates. This is the default risk issue that is commonly addressed in the context of fixed loans. There are in effect two distinct demands for credit in an overdraft or line of credit system. First, there is the demand for the credit limit that is available in all contingencies and which is independent of the second demand, which is the actual drawing against the credit limit. This leads quite naturally to two concepts of credit rationing with overdraft, which I shall call ex ante and ex post. Ex ante rationing occurs when a borrower would like a larger credit limit, given his expectations of the interest rate he will be charged, prior to his actual use of the credit limit. That is, the borrower can anticipate the possibility of some situations in which he might face a binding credit constraint. Ex post rationing occurs when the borrower needs more credit than his limit given the interest rate. This paper is concerned with the existence of ex ante credit rationing in a credit market in which there are no interest rate ceilings on borrowers and lenders, and the credit market is assumed to be competitive in that lenders earn zero expected profit. The result is obtained in a simple two period model in which the borrower requires credit to finance a loan project that is subject to diminishing returns (such as a perfect competitor financing production subject to increasing marginal costs) and faces default risk. A further complication is introduced by assuming that the borrower has a random source of revenue during the life of the credit agreement and this random revenue affects his need for credit from the lender. This model is an abstraction from reality that tries to capture three features of real-life line of credit arrangements: (i) such facilities are typically available to borrowers who are financing working capital and whose revenue from the sale of output may be randomly spaced during the time the credit facility exists. (ii) since the borrower’s cash flow is irregular, then to the extent that overdraft credit and retained earnings are the only source of working capital to the borrower any fluctuations in cash flow will have an impact on the demand for borrowed credit. (iii) the credit facility is never established for an indefinite period, but rather is set up subject to review after a finite period. Once established, the limit is not altered until the review date. This abstracts, of course, from any central bank directive concerning limitations on lending rights. In addition to showing the existence of ex ante credit rationing, the paper also considers the impact of an alternative asset for the borrower to invest in in addition to working capital. As expected, the existence of the asset, by increasing the opportunities to the borrower, leads to a demand for a larger credit limit. The effect of a binding ceiling on lending rate is to raise the average rate of credit utilisation and to increase the degree of credit rationing.

Overdraft Lending and Aggregating Demands Subject to Constraint

An overdraft is a lending instrument, usually offered by banks, that for a predetermined period allows the borrower to overdraw his account up to a predetermined limit. The timing and size of withdrawals is at the discretion of the borrower except, of course, when the credit limit is reached. Lending by Australian banks is predominantly by overdrafts and some attention has been focussed in the past on explaining the behaviour of overdraft advances. Individual demands for credit can therefore be characterised as censored (that is, subject to an upper limit). In practice there are only aggregate data for advances by overdrafts, which creeates difficulties for estimating the behavioural parameters for the demand for advances by overdraft. This paper develops a theory of aggregation of a group of individual demands that are each censored. A measure of credit rationing can also be derived from the approach. The approach is implemented using Australian data for three classes of business borrowers. The results support the view that the observed aggregate quantity of advances by overdraft is determined by both supply and demand factors. This finding is consistent with earlier work by researchers using Australian data. The significance of the present results lies in the attention paid to aggregation and the implications this has for the specification of the estimating equations. A second benefit of the approach is that it permits direct estimation of the distribution of rationed credit demands. The correctly aggregated equation specifies the observed stock of advances as a weighted average of constrained and unconstrained demands for credit, where the weights are interpreted as the probability that an individual borrower faces a binding credit limit. In that limited sense the probability measure, which varies over time, indicates the likelihood and distribution of credit rationing in the overdraft sector. These estimated probabilities are calculated for the three classes of business borrowers (agriculture, commerce and manufacturing) and are similar to the overdraft utilisation ratios in these sectors, which are independent measure of tightness in credit markets.

Price and Quantity Responses to Monetary Impulses in a Model of a Small Open Economy

No abstract available

The Causal Relationship Between Money Base and Money Suppy in Australia: 1960–1979

Australian monetary economists have for some time been intermittently concerned with the relationship between the monetary base and the money stock. Controversy has centred around a number of issues, including: the exogeneity of the money base; the substitutability of cash and other liquid assets in the management of banks’ reserves; the causal significance of the budget deficit of the consolidated government sector relative to imported disturbances; and the appropriate definition of the money base in Australia. This paper provides some additional evidence relevant to this debate. Changes in the financial system during the last two decades, including partial deregulation of the banking system, and the growth of finance companies and permanent building societies, suggest the need for a careful examination of the money/money base relationship. These changes are likely to have altered both the time series properties of the monetary aggregates and may also have changed the observed relationship between various measures of money base and the money stock. The evidence presented in this paper suggests that this may have occurred. The analysis is directed towards three questions. Does the money multiplier vary significantly in terms of its stability with differing measures of money and money base? What is the behavioural significance of differences in stability? How does the causal relationship between money and money base vary over time and with different concepts of base and money? Graphical, numerical and time series analysis are used to shed light on these issues. The results are in some cases conflicting due to the strigent techniques for determining causality but we conclude: • there is evidence of considerable instability in the money multiplier for most concepts of money base during the 60s and 70s. Financial innovation may have been important in this instability. The timing of significant changes in the financial system is consistent with observed instabilities of the multipliers; • the evidence suggests that the M2 money multiplier for the extended base is the most stable for both the sixties and seventies; • there is evidence of contemporaneous correlation between money base measures and the money stock (for M2 and M3) but that the results for the seventies indicate the presence of both a positive causal effect on the money supply from innovations in the money base and feedback effects from the money stock to money base; • there is evidence of some structural change in the time series models for some aggregates between the late sixties and the late seventies; in addition, there is evidence of a structural change within the sixties relating primarily to the private sector’s demand for cash relative to other monetary aggregates and to the growth of the permanent building societies.

The Market for Negotiable Certificates of Deposit in Australia: 1973–1980

Liability management by the Australian trading banks is a relatively recent development, largely made possible by the inroduction of negotiable certificates of deposit (NCD’s). The market for NCD’s also acts as an important link in transmitting credit market disturbances to non-bank financial intermediaries. Relatively little attention has been paid to analysing the working of this market in Australia. This paper presents and estimates two models of the NCD market. In the first case the hypothesis of short term rationing, that arises from various restrictions on the operation of the market, is tested. The second model assumes that the market clears in the short run but adjusts with a lag to the desired long run position. Our results favour the second model. In addition, the demand for NCDs by the non-bank public depends on wealth and interest rates. The supply of NCD’s by the banks depends on the banks liquidity position and on interest rates. The results suggest that banks may use asset management instead of liability management when rates rise on liquid assets of the banks. Adjustment by the non-bank public to the long run demand is instantaneous, while the banks adjust with a lag. Our results suggest that approximately 84 per cent of the adjustment in the banks’ supply occurs within one year.

An Econometric Model of the Australian Trading Banks: 1974–1980

This paper reports on an econometric model of the aggregate behaviour of the Australian trading banks, using monthly data from January 1974 to June 1980. There are two reasons for this study. First, there have been several changes in the institutional environment in which banks operate as a consequence of some deregulation and attempts by the financial sector to circumvent some regulation. Hence, there is a need to focus attention on a period in which government regulation is relatively homogeneous. Second, by using monthly data of reatively recent vintage some better idea of the dynamics of portfolio adjustment by the banks will be obtained. Previous studies have frequently made use of relatively long runs of quarterly data and, for the most part, have found lengthy adjustment lags. The estimated model comprises ten behavioural equations and one identity. There are equations for demand deposits, fixed deposits, negotiable certificates of deposit, overdraft advances and commercial bill acceptances, all of which have been modelled as being determined by the non-bank public. In turn, the banks are assumed to determine the supply of negotiable certificates of deposit, fully drawn loans, overdraft limits, bill acceptance limits and the stock of excess liquid assets (determined residually). There is also an equation for the interest rate on commercial bills. The dynamic simulation properties of the model are also reported, as are the results of three counterfactual experiments. Broadly speaking, the results support the theoretical model that is presented in an appendix. Adjustment by both the banks and the non-bank public is rapid, with most average lages being less than four months.

Australian economic growth in historical perspective

This article reviews recent contributions to the evidence on, and interpretations of, the long-run growth of the Australian economy. It is noted that several themes currently prominent in growth theory and empirical growth analysis are reflected in the recent literature on the Australian historical experience. * The helpful comments of Peter Kenyon, Richard Pomfret, and three referees are gratefully acknowledged. Choon Wang contributed excellent research assistance