"Did the 2008 Rebate Fail? A Response to Taylor and Feldstein "

Did the 2008 rebate fail to stimulate consumer spending? In their recent influential AER articles, John Taylor and Martin Feldstein each claim that BEA aggregate time series data show that the 2008 rebate failed. Re-examining the BEA data, we find that the data instead show there is a high probability that the rebate stimulated consumption. Moreover, the hypothesis that a rebate has half the impact of ordinary disposable income cannot be rejected. Thus, we find that analysis of the BEA aggregate time series data is consistent with the conclusion from the micro-data studies that the 2008 rebate stimulated consumer spending.fiscal policy, fiscal stimulus, tax rebates

"Overcoming the zero interest-rate bound: A quantitative prescription (Revision of Working Paper No. 2006-14)"

Using a macroeconometric model we provide a quantitative estimate of the cash transfer or tax cut that would achieve recovery from a severe recession when the central bank is unable to achieve full recovery because of the zero bound. We introduce an automatic transfer and simulate its triggering in the severe recession. We find that an automatic transfer that averages 3% of quarterly GDP repeated four times (quarterly) reduces the unemployment rate an additional full percentage point and thereby completes the recovery.   We recommend that legislatures enact an automatic counter-cyclical fiscal policy that will assure adequate stimulus without generating a long-term debt problem.Zero-interest rate bound, Counter-cyclical fiscal policy

"Did the 2008 Rebate Fail? A Response to Taylor and Feldstein"

Did the 2008 rebate fail to stimulate consumer spending? In their influential AER articles, John Taylor and Martin Feldstein each claim that BEA aggregate time series data show that the 2008 rebate failed. Re-examining the BEA data, we find that the data instead show there is a high probability that the rebate stimulated consumption. Moreover, the hypothesis that a rebate has half the impact of ordinary disposable income cannot be rejected. Thus, we find that analysis of the BEA aggregate time series data is consistent with the conclusion from the micro-data studies that the 2008 rebate stimulated consumer spending.fiscal policy, fiscal stimulus, tax rebates

"Compensations and contributions under an international carbon treaty"

The simulations in this paper use actual 2004 data on carbon emissions and per capita GDP from 178 countries to provide a rough estimate of how much better off high-income countries might be by compensating low-income countries to help reduce carbon emissions rather than doing it without their help; and a rough estimate of the per capita compensation to each low-income country and the per capita contribution from each high-income country under several alternative formulas that might be adopted under an international carbon treaty. The study focuses special attention on the per capita compensations to India, China, and Russia, and the per capita contributions from the United States, Japan, Germany, United Kingdom, Italy, and France, under alternative formulas. In our initial simulation, if the 46 countries with per capita GDP above $12,000 want to reduce world emissions by 1.095 billion metric tons (15$108 billion if they do it without help. But if they get optimal help from the 132 low-income countries, the total cost of reducing world emissions 1.095 billion would be only $55 billion--$27 billion for the low-income countries and $28 billion for the high-income countries-- so the world cost saving would be$53 billion and the cost saving for the high-income countries would be $80 billion. Thus, if the high-income countries compensate the low-income countries 100$27 billion), the high-income countries would still be $53 billion better off than if they had done it alone. Under the formula used in this initial simulation, China’s per capita compensation would be$7 and the U.S.’s per capita contribution would be $40.International Carbon Treaty

"Income-related patient cost-sharing: Simulation for prescription drugs under Medicare"

This paper studies an application of income-related patient cost-sharing. Using data from the Medicare Current Beneficiary Survey, we find that varying patient costsharing rates with patient income in the Medicare prescription drug program can reduce the severity of two problems: high percent-of-income burdens, and unequal medication due to income. We estimate behavioral responses in the Medicare population and incorporate the estimates into a micro-simulation model which uses data that are representative of the actual Medicare population. We find that introducing incomerelated patient cost-sharing into a Medicare drug program can dramatically reduce the severity of the two problems.Patient Cost-Sharing, Medicare

k-core organization of complex networks

We analytically describe the architecture of randomly damaged uncorrelated networks as a set of successively enclosed substructures -- k-cores. The k-core is the largest subgraph where vertices have at least k interconnections. We find the structure of k-cores, their sizes, and their birth points -- the bootstrap percolation thresholds. We show that in networks with a finite mean number z_2 of the second-nearest neighbors, the emergence of a k-core is a hybrid phase transition. In contrast, if z_2 diverges, the networks contain an infinite sequence of k-cores which are ultra-robust against random damage.Comment: 5 pages, 3 figure

The Swiss Board Directors Network in 2009

We study the networks formed by the directors of the most important Swiss boards and the boards themselves for the year 2009. The networks are obtained by projection from the original bipartite graph. We highlight a number of important statistical features of those networks such as degree distribution, weight distribution, and several centrality measures as well as their interrelationships. While similar statistics were already known for other board systems, and are comparable here, we have extended the study with a careful investigation of director and board centrality, a k-core analysis, and a simulation of the speed of information propagation and its relationships with the topological aspects of the network such as clustering and link weight and betweenness. The overall picture that emerges is one in which the topological structure of the Swiss board and director networks has evolved in such a way that special actors and links between actors play a fundamental role in the flow of information among distant parts of the network. This is shown in particular by the centrality measures and by the simulation of a simple epidemic process on the directors network.Comment: Submitted to The European Physical Journal

The evolution of interdisciplinarity in physics research

Science, being a social enterprise, is subject to fragmentation into groups that focus on specialized areas or topics. Often new advances occur through cross-fertilization of ideas between sub-fields that otherwise have little overlap as they study dissimilar phenomena using different techniques. Thus to explore the nature and dynamics of scientific progress one needs to consider the large-scale organization and interactions between different subject areas. Here, we study the relationships between the sub-fields of Physics using the Physics and Astronomy Classification Scheme (PACS) codes employed for self-categorization of articles published over the past 25 years (1985-2009). We observe a clear trend towards increasing interactions between the different sub-fields. The network of sub-fields also exhibits core-periphery organization, the nucleus being dominated by Condensed Matter and General Physics. However, over time Interdisciplinary Physics is steadily increasing its share in the network core, reflecting a shift in the overall trend of Physics research.Comment: Published version, 10 pages, 8 figures + Supplementary Informatio