http://www.rssboard.org/rss-specification 720 https://escholarship.org/uc/ucr_chass_econ_oapolicydeposits/rss Recent eScholarship items from Department of Economics Open Access Policy Deposits Sat, 27 Jun 2026 17:22:08 +0000 https://escholarship.org/uc/item/7317m5bz Abstract: We estimate a matching model of teachers and elementary schools with rich data on teachers' applications and principals' ratings from a large, urban district in North Carolina. Both teachers’ and principals’ preferences deviate from those that would maximize the achievement of economically disadvantaged students: teachers prefer schools with fewer disadvantaged students, and principals' ratings are weakly related to teacher effectiveness. In equilibrium, these two deviations combine to produce a surprisingly equitable current allocation, where teacher quality is balanced across advantaged and disadvantaged students. To close achievement gaps, policies that address deviations on one side alone are ineffective or harmful, while policies that address both could substantially increase the achievement of disadvantaged students. https://escholarship.org/uc/item/7317m5bz Thu, 30 Jan 2025 00:00:00 +0000 Bates, Michael Dinerstein, Michael Johnston, Andrew C Sorkin, Isaac https://escholarship.org/uc/item/67d0d1kv We measure the impact of two main signals of tertiary-level human capital accumulation, college quality and certification, on hiring in India. Using a correspondence experiment, we send 16,944 resumes to 1,412 job postings for recent engineering graduates at small and medium firms. We do not find evidence that either of the two signals that we consider have effects on callbacks separately. Specifically, the impact of having graduated from a mid-tier college ranked in the top 300 relative to an unranked college outside of the top 1000 is close to zero and precisely estimated, despite significant government investment in ranking colleges in India. There is also a precisely estimated null effect of scoring in the highest as opposed to the lowest quartile of a post-tertiary certification test that has been taken by millions of graduating students. Resumes with female names modestly benefit in this first stage of the hiring process. https://escholarship.org/uc/item/67d0d1kv Mon, 11 Nov 2024 00:00:00 +0000 Batheja, Deepshikha Hirshleifer, Sarojini Kaur, Opinder https://escholarship.org/uc/item/7fb8f9vc Commodity booms generally induce real exchange rate appreciation in commodity-rich economies and make other tradable sectors less competitive. This “Dutch disease” phenomenon has been blamed for leading to structures of production with low diversification and undermining sustainable growth. In this paper, we explore whether capital controls can mitigate the transmission of commodity price changes to the real exchange rate and shield manufactured exports. Examining a panel of 37 commodity-abundant countries over the period 1980–2020, we find that a steeper commodity currency appreciation indeed has a more detrimental impact on manufactured exports. Restrictions on capital flows tend to reduce real appreciation pressures and the severity of the Dutch disease. Countercyclical capital controls seem to help foster economic diversification in commodity-dependent developing countries. https://escholarship.org/uc/item/7fb8f9vc Fri, 18 Oct 2024 00:00:00 +0000 Chen, Kai Lee, Dongwon https://orcid.org/0000-0003-4950-3883 https://escholarship.org/uc/item/5tm423tw Abstract: This article analyzes the international reserve accumulation behavior of emerging and developing economies facing “keeping‐up‐with‐the‐Joneses” externalities. I first document empirical evidence for a significant Joneses effect, which has been particularly persistent in Asia and Latin America since the late 1990s. This peer‐pressure motive could encourage excess reserve hoarding, providing a rationale for cooperation. I then develop a theoretical model of the borrowing economy featuring the Joneses effect and the interdependence between reserves and domestic capital investment. Numerical results show that international cooperation can effectively internalize negative externalities associated with competitive reserve hoarding and induce welfare‐enhancing resource allocations. https://escholarship.org/uc/item/5tm423tw Fri, 18 Oct 2024 00:00:00 +0000 Lee, Dongwon https://escholarship.org/uc/item/4f76w5mx Commodity terms of trade volatility and industry growth https://escholarship.org/uc/item/4f76w5mx Fri, 18 Oct 2024 00:00:00 +0000 Lee, Dongwon https://escholarship.org/uc/item/23c719n9 This article studies international reserves’ nominal exchange rate stabilizing impact in emerging markets and developing countries, with a particular focus on its nonlinearity and asymmetry across different states of the economy. Using the fixed-effects and dynamic panel threshold models, we find the reserves to short-term debt threshold ratio after which the marginal stabilizing effect of reserves begins to fall during tranquil times. Such diminishing returns, however, do not appear to exist even at the excessive level of reserves during the global financial crisis, partly justifying precautionary demand for international reserves. These results call for extending reserve pooling or swap arrangements to enhance efficiency of reserve management by holding adequate, rather than excess, international reserves with an access to emergency lending during the crisis. https://escholarship.org/uc/item/23c719n9 Fri, 18 Oct 2024 00:00:00 +0000 Lee, Dongwon https://orcid.org/0000-0003-4950-3883 Kim, Kyungkeun Lee, Dong Won https://escholarship.org/uc/item/1vt183wv Global financial integration and monetary policy spillovers https://escholarship.org/uc/item/1vt183wv Fri, 18 Oct 2024 00:00:00 +0000 Lee, Dongwon https://escholarship.org/uc/item/1r9721h0 Market power, inflation targeting, and commodity currencies https://escholarship.org/uc/item/1r9721h0 Fri, 18 Oct 2024 00:00:00 +0000 Chen, Yu-chin Lee, Dongwon https://escholarship.org/uc/item/1nh14563 This paper examines how the financial globalization affects international equity mutual funds' portfolio choices in emerging markets. By examining the monthly holdings of 155 international funds, we first show that these funds actively engage in a rebalancing strategy to maintain their risk preferences upon realization of excess return changes. We also document robust evidence that these funds' propensity of rebalancing is larger in a country whose equity market is more strongly correlated with the global market. The results help understand how the financial globalization may raise the portfolio risk of the international funds' equity holdings in emerging economies. https://escholarship.org/uc/item/1nh14563 Fri, 18 Oct 2024 00:00:00 +0000 Kim, Kyungkeun Lee, Dongwon https://escholarship.org/uc/item/1bk7h4bj Financial integration and international risk spillovers https://escholarship.org/uc/item/1bk7h4bj Fri, 18 Oct 2024 00:00:00 +0000 Lee, Dongwon https://escholarship.org/uc/item/0hs8w2kz Non linear correlated random effects models with endogeneity and unbalanced panels https://escholarship.org/uc/item/0hs8w2kz Thu, 18 Jul 2024 00:00:00 +0000 Bates, Michael D Papke, Leslie E Wooldridge, Jeffrey M https://escholarship.org/uc/item/53n4q35z This study examines the dissemination of (mis)information on a social media platform in Pakistan. It combines an intervention to disseminate official information about the COVID-19 pandemic across the platform with a randomized experiment that measures the impact of fully controlling access to pandemic-related misinformation. The two treatments rely on a higherintensity, ex-ante approach to moderating misinformation on the platform relative to the control, which relies on a more standard ex-post approach to moderation. In one treatment, no misinformation was allowed on the platform, while in the other, it was allowed with an official rebuttal. Controlling misinformation, as in the treatments, reduces platform usage by 41%, indicating a distaste for moderation. Furthermore, the treatments reduce exposure to official information by 29% more than they reduce exposure to misinformation. A conceptual framework posits that these findings can be explained by the fact that, in this setting,... https://escholarship.org/uc/item/53n4q35z Wed, 17 Jul 2024 00:00:00 +0000 Rezaee, Arman Hirshleifer, Sarojini Naseem, Mustafa Raza, Agha Ali https://escholarship.org/uc/item/8qf6611b Public and Private Employer Learning: Evidence from the Adoption of Teacher Value Added https://escholarship.org/uc/item/8qf6611b Mon, 10 Jun 2024 00:00:00 +0000 Bates, Michael https://escholarship.org/uc/item/4q01v9hb Summary: We propose the construction of conditional growth densities under stressed factor scenarios to assess the level of exposure of an economy to small probability but potentially catastrophic economic and/or financial scenarios, which can be either domestic or international. The choice of severe yet plausible stress scenarios is based on the joint probability distribution of the underlying factors driving growth, which are extracted with a multilevel dynamic factor model (DFM) from a wide set of domestic/worldwide and/or macroeconomic/financial variables. All together, we provide a risk management tool that allows for a complete visualization of the dynamics of the growth densities under average scenarios and extreme scenarios. We calculate growth‐in‐stress (GiS) measures, defined as the 5% quantile of the stressed growth densities, and show that GiS is a useful and complementary tool to growth‐at‐risk (GaR) when policymakers wish to carry out a multidimensional scenario... https://escholarship.org/uc/item/4q01v9hb Thu, 6 Jun 2024 00:00:00 +0000 González‐Rivera, Gloria Rodríguez‐Caballero, C Vladimir Ruiz, Esther https://escholarship.org/uc/item/53z5j8xr Which Districts Get into Financial Trouble and Why: Michigan's Story (vol 42, pg 100, 2016) https://escholarship.org/uc/item/53z5j8xr Fri, 10 May 2024 00:00:00 +0000 Arsen, David De Luca, Thomas Ni, Yongmei Bates, Michael https://escholarship.org/uc/item/49n079pj Summary: We propose a per‐cluster instrumental variable (PCIV) approach for estimating linear correlated random coefficient models in the presence of contemporaneous endogeneity and two‐way fixed effects. This approach estimates heterogeneous effects and aggregates them to population averages. We demonstrate consistency, showing robustness over standard estimators, and provide analytic standard errors for robust inference. In Monte Carlo simulation, PCIV performs relatively well in finite samples in either dimension. We apply PCIV in estimating the price elasticity of gasoline demand using state fuel taxes as instrumental variables. We find significant elasticity heterogeneity and more elastic gasoline demand on average than with standard estimators. https://escholarship.org/uc/item/49n079pj Fri, 10 May 2024 00:00:00 +0000 Bates, Michael Kim, Seolah https://escholarship.org/uc/item/3t43v85b Do learning communities increase first year college retention? Evidence from a randomized control trial https://escholarship.org/uc/item/3t43v85b Fri, 10 May 2024 00:00:00 +0000 Azzam, Tarek Bates, Michael D Fairris, David https://escholarship.org/uc/item/3g07s5rr Teacher Labor Market Equilibrium and Student Achievement https://escholarship.org/uc/item/3g07s5rr Fri, 10 May 2024 00:00:00 +0000 Bates, Michael Dinerstein, Michael Johnston, Andrew C Sorkin, Isaac https://escholarship.org/uc/item/2cd406vh Which Districts Get Into Financial Trouble and Why: Michigan's Story https://escholarship.org/uc/item/2cd406vh Fri, 10 May 2024 00:00:00 +0000 Arsen, David DeLuca, Thomas Ni, Yongmei Bates, Michael https://escholarship.org/uc/item/9v98h6zt This study examines how controlling misinformation on a social media platform in Pakistan affects users’ exposure to both accurate and false information. It combines an intervention to disseminate official information about the COVID-19 pandemic across the platform with a randomized experiment that measures the impact of fully controlling access to pandemic-related misinformation. The treatments rely on a higher-intensity, ex ante approach to moderating misinformation on the platform relative to the control, which relies on a typical ex post approach to moderation. Fully controlling misinformation, as in the treatments, reduces the number of daily users by 19%, indicating a distaste for moderation. Furthermore, the treatments reduce exposure to official information by 29% more than they reduce exposure to misinformation. A conceptual framework posits that these findings can be explained by the fact that, in this setting, official information is more trusted, and thus is more widely... https://escholarship.org/uc/item/9v98h6zt Tue, 19 Sep 2023 00:00:00 +0000 Hirshleifer, Sarojini Naseem, Mustafa Raza, Agha Ali Rezaee, Arman https://escholarship.org/uc/item/4cp157xr Haemophilus influenzae type b (Hib) affects 337,000 Indian children every year. A vaccine against Hib was introduced in 2011 as part of the pentavalent vaccine and scaled up nationwide. This study investigated the associations between Hib vaccination and child anthropometry, cognition, and schooling outcomes in India. We used longitudinal survey data and employed propensity score matching to control for observed systematic differences between children who reported receipt or nonreceipt of Hib vaccine before age 6 years (n = 1824). Z-scores of height-for-age (HAZ) and BMI-for-age (BMIZ), percentage scores of English, mathematics, reading, and Peabody Picture Vocabulary tests, and attained schooling grade of children were examined. Hib-vaccinated children had 0.25 higher HAZ, scored 4.09 percentage points (pp) higher on the English test and 4.78 pp higher on the mathematics test, and attained 0.16 more schooling grades than Hib-unvaccinated children at age 11-12 years. At age 14-15... https://escholarship.org/uc/item/4cp157xr Tue, 27 Jun 2023 00:00:00 +0000 Nandi, Arindam Deolalikar, Anil B Bloom, David E Laxminarayan, Ramanan https://escholarship.org/uc/item/8vm6m9h1 BACKGROUND: Activation of the mammalian target of rapamycin (mTOR) pathway is observed in neurofibromatosis type 1 (NF1) associated low-grade gliomas (LGGs), but agents that inhibit this pathway, including mTOR inhibitors, have not been studied in this population. We evaluate the efficacy of the orally administered mTOR inhibitor everolimus for radiographically progressive NF1-associated pediatric LGGs. METHODS: Children with radiologic-progressive, NF1-associated LGG and prior treatment with a carboplatin-containing chemotherapy were prospectively enrolled on this phase II clinical trial to receive daily everolimus. Whole blood was analyzed for everolimus and markers of phosphatidylinositol-3 kinase (PI3K)/mTOR pathway inhibition. Serial MRIs were obtained during treatment. The primary endpoint was progression-free survival at 48 weeks. RESULTS: Twenty-three participants (median age, 9.4 y; range, 3.2-21.6 y) were enrolled. All participants were initially evaluable for response;... https://escholarship.org/uc/item/8vm6m9h1 Wed, 7 Jun 2023 00:00:00 +0000 Ullrich, Nicole J Prabhu, Sanjay P Reddy, Alyssa T Fisher, Michael J Packer, Roger Goldman, Stewart Robison, Nathan J Gutmann, David H Viskochil, David H Allen, Jeffrey C Korf, Bruce Cantor, Alan Cutter, Gary Thomas, Coretta Perentesis, John P Mizuno, Tomoyuki Vinks, Alexander A Manley, Peter E N, Susan Kieran, Mark W https://escholarship.org/uc/item/6789k13h ON ENDOGENOUS BUSINESS CYCLES UNDER INCREASING RETURNS TO VARIETY AND SECTOR‐SPECIFIC EXTERNALITY https://escholarship.org/uc/item/6789k13h Wed, 2 Sep 2020 00:00:00 +0000 Chang, Juin‐Jen Guo, Jang‐Ting https://orcid.org/0000-0001-9948-9691 Wang, Wei‐Neng https://escholarship.org/uc/item/0sd3m02m Purpose: This paper is concerned with the impact of the University of California Cooperative Extension (UCCE) on regional productivity in California agriculture. UCCE is responsible for agricultural research and development (R&amp;D), and dissemination of agricultural know-how in the state. Method/methodology/approach: We estimate the effect of UCCE on county-level agricultural productivity for the years 1992–2012, using an agricultural production function with measures of agricultural extension inputs alongside the traditional agricultural production inputs at the county level. Findings: Results show a positive impact of UCCE through its stock of depreciated expenditures. For an additional dollar spent on UCCE expenditures stock, agricultural productivity, measured as value of sales at the county level, improves by $1–9 per acre of farmland for knowledge/expenditure depreciation rates between 0 and 20 percent. Practical implications: Results suggest that county differences in... https://escholarship.org/uc/item/0sd3m02m Thu, 25 Jun 2020 00:00:00 +0000 Chatterjee, Diti Dinar, Ariel González-Rivera, Gloria https://escholarship.org/uc/item/8hf50446 HEDONIC PRICES AND EQUILIBRIUM SORTING IN HOUSING MARKETS: A CLASSROOM SIMULATION https://escholarship.org/uc/item/8hf50446 Tue, 12 May 2020 00:00:00 +0000 Anderson, Soren T Bates, Michael D https://escholarship.org/uc/item/4cf16730 <b>Background:</b> It is unknown whether self-reported measures of household food insecurity change in response to food-based nutrient supplementation.<b>Objective:</b> We assessed the impacts of providing lipid-based nutrient supplements (LNSs) to women during pregnancy and postpartum and/or to their children on self-reported household food insecurity in Malawi [DOSE and DYAD trial in Malawi (DYAD-M)], Ghana [DYAD trial in Ghana (DYAD-G)], and Bangladesh [Rang-Din Nutrition Study (RDNS) trial].<b>Methods:</b> Longitudinal household food-insecurity data were collected during 3 individually randomized trials and 1 cluster-randomized trial testing the efficacy or effectiveness of LNSs (generally 118 kcal/d). Seasonally adjusted Household Food Insecurity Access Scale (HFIAS) scores were constructed for 1127 DOSE households, 732 DYAD-M households, 1109 DYAD-G households, and 3671 RDNS households. The impact of providing LNSs to women during pregnancy and the first 6 mo postpartum... https://escholarship.org/uc/item/4cf16730 Tue, 6 Aug 2019 00:00:00 +0000 Adams, Katherine P https://orcid.org/0000-0002-1060-2473 Ayifah, Emmanuel Phiri, Thokozani E Mridha, Malay K Adu-Afarwuah, Seth Arimond, Mary Arnold, Charles D https://orcid.org/0000-0001-6510-3172 Cummins, Joseph Hussain, Sohrab Kumwenda, Chiza Matias, Susana L Ashorn, Ulla Lartey, Anna Maleta, Kenneth M Vosti, Stephen A Dewey, Kathryn G https://orcid.org/0000-0002-4185-3451 https://escholarship.org/uc/item/9b34w3kn Rudd and Whelan (2006) document evidence that the first-difference of inflation negatively depends on its own lag, and highlight that sticky price models emphasizing the role of firms’ forward-looking pricing behavior cannot be reconciled with the stylized fact. We show that the puzzling negative dependence of the first-difference of inflation on its own lag is consistent with the prediction of the hybrid New Keynesian Phillips Curve (NKPC) with lags of inflation, whereas, as it is argued, it is inconsistent with the prediction of both the purely forward-looking NKPC and its hybrid variant with a lag of inflation. Our theoretical results show that the negative dependence appears only when firms’ forward-looking pricing behavior is relatively more important than backward-looking behavior in determining inflation dynamics. https://escholarship.org/uc/item/9b34w3kn Wed, 21 Nov 2018 00:00:00 +0000 Chauvet, Marcelle Hur, Joonyoung Kim, Insu https://escholarship.org/uc/item/7p33j43m We examine the theoretical interrelations between progressive income taxation and macroeconomic (in)stability in an otherwise standard one-sector AK model of endogenous growth with utility-generating government purchases of goods and services. In sharp contrast to traditional Keynesian-type stabilization policies, progressive taxation operates like an automatic destabilizer that generates equilibrium indeterminacy and belief-driven fluctuations in our endogenously growing macroeconomy. Unlike the no-sustained-growth counterpart, this instability result is obtained regardless of (i) the degree of the public-spending preference externality and (ii) whether private and public consumption expenditures are substitutes, complements or additively separable in the household's utility function. https://escholarship.org/uc/item/7p33j43m Tue, 20 Nov 2018 00:00:00 +0000 Chen, Shu‐Hua Guo, Jang‐Ting https://orcid.org/0000-0001-9948-9691 https://escholarship.org/uc/item/09n834ct Our study examines empirically the impact of agricultural research inputs on the creation and dissemination of knowledge by the University of California Cooperative Extension (UCCE). We formulate a conceptual framework to understand the relationship between the agricultural research inputs employed by UCCE and the knowledge shared. We develop an index of knowledge based on a weighted average of the various modes through which knowledge is produced by UCCE's agricultural research for all counties in the state of California during 2007–2013. Empirical results indicate significant positive impacts of research inputs on the production of knowledge. We find research input, such as number of research positions measured as full-time equivalent (FTE), level of salary per researcher (including seniority and status), and investment in research infrastructure per FTE, positive and significant. Our models suggest diminishing marginal knowledge returns to research infrastructure, and a linear... https://escholarship.org/uc/item/09n834ct Tue, 14 Aug 2018 00:00:00 +0000 Chatterjee, Diti Dinar, Ariel González-Rivera, Gloria https://escholarship.org/uc/item/77g4s66w Ependymal tumors across age groups are currently classified and graded solely by histopathology. It is, however, commonly accepted that this classification scheme has limited clinical utility based on its lack of reproducibility in predicting patients' outcome. We aimed at establishing a uniform molecular classification using DNA methylation profiling. Nine molecular subgroups were identified in a large cohort of 500 tumors, 3 in each anatomical compartment of the CNS, spine, posterior fossa, supratentorial. Two supratentorial subgroups are characterized by prototypic fusion genes involving RELA and YAP1, respectively. Regarding clinical associations, the molecular classification proposed herein outperforms the current histopathological classification and thus might serve as a basis for the next World Health Organization classification of CNS tumors. https://escholarship.org/uc/item/77g4s66w Thu, 1 Mar 2018 00:00:00 +0000 Pajtler, Kristian W Witt, Hendrik Sill, Martin Jones, David TW Hovestadt, Volker Kratochwil, Fabian Wani, Khalida Tatevossian, Ruth Punchihewa, Chandanamali Johann, Pascal Reimand, Jüri Warnatz, Hans-Jörg Ryzhova, Marina Mack, Steve Ramaswamy, Vijay Capper, David Schweizer, Leonille Sieber, Laura Wittmann, Andrea Huang, Zhiqin van Sluis, Peter Volckmann, Richard Koster, Jan Versteeg, Rogier Fults, Daniel Toledano, Helen Avigad, Smadar Hoffman, Lindsey M Donson, Andrew M Foreman, Nicholas Hewer, Ekkehard Zitterbart, Karel Gilbert, Mark Armstrong, Terri S Gupta, Nalin https://orcid.org/0000-0001-9539-7052 Allen, Jeffrey C Karajannis, Matthias A Zagzag, David Hasselblatt, Martin Kulozik, Andreas E Witt, Olaf Collins, V Peter von Hoff, Katja Rutkowski, Stefan Pietsch, Torsten Bader, Gary Yaspo, Marie-Laure von Deimling, Andreas Lichter, Peter Taylor, Michael D Gilbertson, Richard Ellison, David W Aldape, Kenneth Korshunov, Andrey Kool, Marcel Pfister, Stefan M https://escholarship.org/uc/item/04d1s9dd We examine the theoretical interrelations between progressive income taxation and macroeconomic (in)stability in an otherwise standard one-sector real business cycle model with utility-generating government purchases of goods and services. When private and public consumption expenditures are complements in the household utility and the tax schedule is progressive, we analytically show that the economy exhibits indeterminacy and sunspots if and only if the degree of government-spending preference externality is higher than a critical threshold. Unlike traditional Keynesian-type stabilization policies, raising the tax progressivity may destabilize this version of our model by generating endogenous cyclical fluctuations. Moreover, the economy always displays saddle-path stability and equilibrium uniqueness under utility substitutability between private and public consumptions and progressive taxation. https://escholarship.org/uc/item/04d1s9dd Tue, 20 Jun 2017 00:00:00 +0000 Chen, Shu-Hua Guo, Jang-Ting https://orcid.org/0000-0001-9948-9691 https://escholarship.org/uc/item/3kj7h1sz Monitoring Financial Intermediaries with Subordinated Debt: A Dynamic Signal Model for Bank Risk https://escholarship.org/uc/item/3kj7h1sz Tue, 14 Feb 2017 00:00:00 +0000 González-Rivera, Gloria Nickerson, David B https://escholarship.org/uc/item/9zh6r05k BACKGROUND: Maternal undernutrition and newborn stunting [birth length-for-age z score (LAZ) &lt;-2] are common in Bangladesh. OBJECTIVE: The objective was to evaluate the effect of lipid-based nutrient supplements for pregnant and lactating women (LNS-PLs) on birth outcomes. DESIGN: We conducted a cluster-randomized effectiveness trial (the Rang-Din Nutrition Study) within a community health program in rural Bangladesh. We enrolled 4011 pregnant women at ≤20 gestational weeks; 48 clusters received iron and folic acid (IFA; 60 mg Fe + 400 μg folic acid) and 16 clusters received LNS-PLs (20 g/d, 118 kcal) containing essential fatty acids and 22 vitamins and minerals. Both of the supplements were intended for daily consumption until delivery. Primary outcomes were birth weight and length. RESULTS: Infants in the LNS-PL group had higher birth weights (2629 ± 408 compared with 2588 ± 413 g; P = 0.007), weight-for-age z scores (-1.48 ± 1.01 compared with -1.59 ± 1.02; P = 0.006), head-circumference-for-age... https://escholarship.org/uc/item/9zh6r05k Mon, 13 Feb 2017 00:00:00 +0000 Mridha, Malay K Matias, Susana L Chaparro, Camila M Paul, Rina R Hussain, Sohrab Vosti, Stephen A Harding, Kassandra L Cummins, Joseph R Day, Louise T Saha, Stacy L Peerson, Janet M Dewey, Kathryn G https://orcid.org/0000-0002-4185-3451 https://escholarship.org/uc/item/50f9626d This article examines the quantitative interrelations between sectoral composition of public spending and equilibrium (in)determinacy in a two-sector real business cycle model with positive productive externalities in investment. When government purchases of consumption and investment goods are set as constant fractions of their respective sectoral output, we show that the public-consumption share plays no role in the model's local dynamics, and that a sufficiently high public-investment share can stabilize the economy against endogenous belief-driven cyclical fluctuations. When each type of government spending is postulated as a constant proportion of the economy's total output, we find that there exists a trade-off between public consumption versus investment expenditures to yield saddle-path stability and equilibrium uniqueness. (JEL E32, E62, O41). https://escholarship.org/uc/item/50f9626d Tue, 3 Jan 2017 00:00:00 +0000 Chang, JJ Guo, JT https://orcid.org/0000-0001-9948-9691 Shieh, JY Wang, WN https://escholarship.org/uc/item/8wb405gk This paper examines a dynamic model of nonlinear income taxation in which the government cannot commit to its future tax policy, and individuals are quasi-hyperbolic discounters who cannot commit to future consumption plans. The government has both paternalistic and redistributive objectives, and therefore uses its taxation powers to maximize a utilitarian social welfare function that reflects individuals' true (long-run) preferences. Under first-best taxation, quasi-hyperbolic discounting exerts no effect on the level of social welfare attainable. Under second-best taxation, quasi-hyperbolic discounting increases (resp. decreases) the level of social welfare attainable when separating (resp. pooling) taxation is optimal. In stark contrast to previous studies, this result implies that some individuals can actually be better-off in the long run as a result of their short-run impatience. https://escholarship.org/uc/item/8wb405gk Tue, 20 Dec 2016 00:00:00 +0000 Guo, Jang-Ting https://orcid.org/0000-0001-9948-9691 Krause, Alan https://escholarship.org/uc/item/8h60j05c We examine the theoretical interrelations between equilibrium (in)determinacy and economic growth in a one-sector representative-agent model of endogenous growth with progressive taxation of income and productive flow of public spending. We analytically show that, if the demand-side effect of government purchases is weaker, the economy exhibits an indeterminate balanced-growth equilibrium and belief-driven growth fluctuations when the tax schedule is sufficiently progressive or regressive. If the supply-side effect of public expenditures is weaker, indeterminacy and sunspots arise under progressive income taxation. In sharp contrast to traditional Keynesian-type stabilization policies, our analysis finds that raising the tax progressivity may destabilize an endogenously growing economy with fluctuations driven by agents' self-fulfilling expectations. Sur l'indétermination et la croissance quand la fiscalité est progressive et les dépenses gouvernementales productives. On examine... https://escholarship.org/uc/item/8h60j05c Tue, 20 Dec 2016 00:00:00 +0000 Chen, Shu‐Hua Guo, Jang‐Ting https://orcid.org/0000-0001-9948-9691 https://escholarship.org/uc/item/6v06b60f This paper quantitatively examines the empirical plausibility of equilibrium indeterminacy and sunspot-driven cyclical fluctuations in a real business cycle model with two distinct production sectors that yield consumption and investment goods, together with separable or non-separable preferences. When calibrated to match the observed progressivity of the U.S. federal individual income tax schedule, each version of our model economy exhibits an indeterminate steady state under empirically realistic combinations of the household's labor supply elasticity and the degree of productive externalities in the investment goods sector. Therefore, macroeconomic instability due to agents' self-fulfilling expectations may in fact be a prevalent feature of the U.S. https://escholarship.org/uc/item/6v06b60f Tue, 20 Dec 2016 00:00:00 +0000 Guo, Jang‐Ting https://orcid.org/0000-0001-9948-9691 Harrison, Sharon G https://escholarship.org/uc/item/4xf4g4cf This paper addresses the question as to whether it is optimal to use separating or pooling nonlinear income taxation, or to use linear income taxation, when the government cannot commit to its future tax policy. We consider both two- period and inÖnite-horizon settings. Under empirically plausible parameter values, separating income taxation is optimal in the two-period model, whereas linear income taxation is optimal when the time horizon is inÖnite. The welfare e§ects of varying the discount rate, the degree of wage inequality, and the population of high-skill workers are also explored. For realistic changes in these parameters, separating income taxation remains optimal in the two-period formulation, and linear income taxation remains optimal in the inÖnite-horizon model. https://escholarship.org/uc/item/4xf4g4cf Tue, 20 Dec 2016 00:00:00 +0000 Guo, Jang-Ting https://orcid.org/0000-0001-9948-9691 Krause, Alan https://escholarship.org/uc/item/3t47r83g This article examines the quantitative interrelations between sectoral composition of public spending and equilibrium (in)determinacy in a two-sector real business cycle model with positive productive externalities in investment. When government purchases of consumption and investment goods are set as constant fractions of their respective sectoral output, we show that the public-consumption share plays no role in the model's local dynamics, and that a sufficiently high public-investment share can stabilize the economy against endogenous belief-driven cyclical fluctuations. When each type of government spending is postulated as a constant proportion of the economy's total output, we find that there exists a trade-off between public consumption versus investment expenditures to yield saddle-path stability and equilibrium uniqueness. © 2014 Western Economic Association International. https://escholarship.org/uc/item/3t47r83g Tue, 20 Dec 2016 00:00:00 +0000 Chang, Juin‐Jen Guo, Jang‐Ting https://orcid.org/0000-0001-9948-9691 Shieh, Jhy‐Yuan Wang, Wei‐Neng https://escholarship.org/uc/item/20h30150 The plausibility of expectations-driven cyclical fluctuations in an otherwise standard one-sector real business cycle model with variable capital utilization and mild increasing returns-to-scale in production is examined. Due to a dominating wealth effect, our model is able to generate qualitatively as well as quantitatively realistic aggregate fluctuations driven by news impulses to future consumption demand or government spending on goods and services. When the economy is subject to anticipated total factor productivity or investment-specific technology shocks, the relative strength of the intertemporal substitution effect needs to be enhanced for our model to exhibit positive macroeconomic co-movement and business cycle statistics that are consistent with the data. https://escholarship.org/uc/item/20h30150 Tue, 20 Dec 2016 00:00:00 +0000 Guo, Jang-Ting https://orcid.org/0000-0001-9948-9691 Sirbu, Anca-Ioana Weder, Mark https://escholarship.org/uc/item/5ct613nz The current regression models for interval-valued data ignore the extreme nature of the lower and upper bounds of intervals. A new estimation approach is proposed; it considers the bounds of the interval as realizations of the max/min order statistics coming from a sample of nt random draws from the conditional density of an underlying stochastic process {Yt}. This approach is important for data sets for which the relevant information is only available in interval format, e.g., low/high prices. The interest is on the characterization of the latent process as well as in the modeling of the bounds themselves. A dynamic model is estimated for the conditional mean and conditional variance of the latent process, which is assumed to be normally distributed, and for the conditional intensity of the discrete process {nt}, which follows a negative binomial density function. Under these assumptions, together with the densities of order statistics, maximum likelihood estimates of the parameters... https://escholarship.org/uc/item/5ct613nz Wed, 22 Jun 2016 00:00:00 +0000 Lin, Wei González-Rivera, Gloria https://escholarship.org/uc/item/4gk0t834 © 2014 International Institute of Forecasters. We propose a new tool, the Generalized Autocontour (G-ACR), as the basis for a battery of dynamic specification tests that are applicable (in-sample or out-of-sample) to univariate or multivariate random processes. We apply this methodology to the modeling of a multivariate system by specifying the dynamics of the marginal distributions of each process in the system, together with a copula that ties up the marginals to produce their multivariate distribution. We work with the probability integral transforms (PIT) of the system that, under a correct specification of the conditional model, should be i.i.d.U[0,1]. The dimensionality of the system is not a constraint, because the information contained in the vector of PITs is condensed into an indicator, which is the basis of the proposed tests. We construct hyper-cubes of different sizes within the max imum hyper-cube formed by a multidimensional uniform density [0, 1] &lt; sup &gt;... https://escholarship.org/uc/item/4gk0t834 Tue, 19 Jan 2016 00:00:00 +0000 González-Rivera, G Sun, Y