A Test of the Rational Expectations-Permanent Income Hypothesis for Singapore Revisited

This paper repeats Thornton's (1993) test of the rational expectations-permanent income hypothesis (REPIH) for Singapore using an alternative data set based upon real disposable income and real consumer expenditure. In contrast to Thornton, but in line with most other studies, we find anticipated income to be significant and interpret this as evidence against the REPIH.     

A Test of the Rational Expectations‐Permanent Income Hypothesis for Singapore Revisited

This paper repeats Thornton's (1993) test of the rational expectations‐permanent income hypothesis (REPIH) for Singapore using an alternative data set based upon real disposable income and real consumer expenditure. In contrast to Thornton, but in line with most other studies, we find anticipated income to be significant and interpret this as evidence against the REPIH.     

Impacts of Sequential Free Trade Agreements in East Asia: A CGE and Political Economy Analysis

Abstract

This paper estimates the economic impacts of the various sequential liberalization scenarios in East Asia, emphasizing the significance of the “sequence” of the liberalization process in computable general equilibrium (CGE) analysis. The major findings are as follows: (1) “Sequence” matters in measuring the economic impacts of free trade agreement (FTA) scenarios in the region; (2) Scenario 1 (Korea-China FTA → Korea-Japan FTA → China-Japan FTA) is the sequence maximizing Korea's economic gains, whereas Scenario 3 (Korea-China-Japan FTA) is the one most preferred economically by China and Japan; (3) Korea's FTAs with the United States (US) and European Union (EU) can be evaluated as a preemptive strategic move, causing changes in FTA preferences of Korea and Japan; (4) the prediction of Bond and Baldwin (adjustment cost and juggernaut effect) and that of Evenett et al. (trade diversion effect) are supported by the empirical results that Korea's (China's) expected gains from northeast Asian FTA sequences increase (decrease) after Korea's FTAs with the US and EU are made; (5) predictions about the International Political Economy (IPE) theories (power consideration and domestic politics) upon the sequential FTA formations in East Asia are consistent with the findings above.     

Land-use planning to help sustain tropical forest resources

Greater use of land-use planning could help sustain tropical forest resources, particularly in countries where future alternatives have not been closed off by prior land-use allocations. Although suitable planning techniques are available, they have not been used to their full potential in tropical countries because of (1) insufficient appreciation by decision- makers, (2) limited availability of data, (3) scarcity of planning expertise, (4) cost, and (5) domination of decision-making by special interest groups. The usefulness of existing techniques can be improved by (1) increasing the timeliness and focus of analysis, (2) improving the data base, (3) encouraging public participation, (4) improving communication of findings, (5) adopting an interdiciplinary approach, and (6) incorporating better monitoring and evaluation in project implementation.     

Ten Commandments for a Fiscal Rule in the E(M)U

Fiscal rules in a monetary union should (1) be simple; (2) ensurethe solvency of the state; (3) relate to the consolidated generalgovernment and central bank; (4) be neutral as regards the sizeof the public sector; (5) avoid pro-cyclical behaviour of thefiscal policy instruments; (6) also make sense in the long run;(7) allow for important differences in economic structure andinitial conditions; (8) aggregate into behaviour that makessense at the level of the union as a whole; (9) be credible;and (10) be enforced impartially and consistently. The paperreviews the rules of the Stability and Growth Pact, the UK'sgolden rule and sustainable-investment rule, and Buiter andGrafe's permanent-balance rule from the perspective of how wellthey meet these ten criteria.     

基于机器学习的斜坡堤越浪量预测方法研究

针对斜坡堤越浪量预测方法,分别建立集成神经网络(ensemble neural network,ENN)、随机森林(random for-eset,RF)和支持向量回归机(suppport vector regression,SVR)3种机器学习模型对斜坡堤越浪量进行预测,并利用决定系数R2和均方根误差RMSE来评估模型性能.最后,对3种模型的性能进行分析.结果显示,集成神经网络模型的决定系数R2和均方根误差RM S E分别约为0.96和0.0018,随机森林模型的决定系数R2和均方根误差RMSE分别约为0.97和0.0014,支持向量回归机模型的决定系数R2和均方根误差RMSE分别约为0.94和0.002.对比发现,3种模型的决定系数都达到0.9以上,都具有较高的预测精度,随机森林相比其他两个模型精度更高.     

国际收支失衡下的中国货币政策——基于结构型VAR的经验研究

本文采用结构型VAR模型,旨在揭示中国国际收支失衡下货币政策的反应及其对于宏观经济波动的影响。我们发现:(1)针对经常项目和资本项目盈余,央行分别采取扩张性和紧缩性政策;(2)紧缩性货币政策会增加经常项目盈余,但对资本流动的影响很小;(3)净出口和净资本流入的正向冲击分别导致CPI的下降和上升。除净出口冲击降低CPI并伴随扩张性货币政策外,其他发现都符合理论判断,说明了央行针对国际收支失衡实施的货币政策的合理性。     

Dependence and industrialization strategies

This paper explores the goal of national independence (or the problem of dependence) in the context of industrial strategy. It breaks down the broad goal into components and then looks at how alternative strategies of industrialization might perform for a developing country that is concerned about reducing its dependence on the industrial world. Five types of dependence are considered as possible targets of such a policy: (1) market dependence: (2) technological dependence; (3) managerial and entreprenuerial dependence; (4) foreign capital dependence; and (5) economic inflexibility.     

Institutions and the rise of taxes on labour in the OECD

Institutions and the Rise of Taxes on Labour in the OECD. —The aim of this paper is to explain differences among OECD countries in the evolution of taxes on labour during the last two decades. Its main message is that these taxes are to an important extent structurally and institutionally determined. Tax rates on labour are shown to have risen more strongly in countries where: (i) government has been controlled mainly by leftist parties; (ii) taxes (in general) are decided and collected mainly by central government (fiscal centralization); (iii) coalition and minority governments are frequent; (iv) the partisan composition (political colour) of these coalitions is unstable; (v) the labour market is neither centralized nor decentralized.     

The New International Financial Architecture: Progress and Challenges

Recent economic crises have affected different countries in the last decade. Crises shook not only countries that were directly affected but also other more developed countries. Part of the risk of crises derives from the considerable negative effects imposed on economies by the volatility and reversibility of short-term capital flow. International financial reforms should consider (1) regulation and supervision, (2) statistical standards, (3) the goods and services trade, (4) liquidity and lender of last resort, (5) unified action, (6) private-sector involvement, and (7) other contingency measures. The Venezuelan experience suggests some other domestic reforms, but reforming the international financial system, in the direction of globalization, has to be the principle goal of international organizations.     

Notes and Communications

This paper presents a simple, explicit formula for setting the optimal VAT exemption threshold that depends on only six parameters: (1) the administrative and compliance costs, (2) the VAT rate, (3) the value-added coefficient, (4) the elasticity of substitution in consumption, (5) the value of government expenditure financed by the VAT revenue, and (6) the VAT/GDP ratio. The formula is derived from an articulated model of utility and profit maximization, and is shown to be capable of yielding reasonable results based on plausible parameter values.     

International Evidence on the Matching Between Revenues and Expenses

This study investigates the time‐series trend and determinants of matching between revenues and expenses in a sample of 42 countries. We find that the decline in matching documented by Dichev and Tang ( 2008 ) is not unique to the United States, but is a worldwide phenomenon. Our results show that matching is weaker in countries with (i) wider use of accrual accounting; (ii) a larger proportion of firms reporting significant special items; (iii) slower economic growth; (iv) more research and development activities; (v) larger service sectors; and (vi) stronger investor protection. We find no evidence that mandatory adoption of International Financial Reporting Standards affects matching. Changes in accounting and economic factors collectively explain the downward trend in matching. Overall, the results suggest that both accounting and economic factors are important determinants of matching over time and across countries.     

Output and Input Biases Caused by Public Agricultural Research and Extension in Japan, 1957–1997

The present paper investigates the magnitude and the Hicksian output and input biases of technological change brought about by investments in public agricultural research and extension activities in Japan. Given this objective, it estimates a translog multiproduct cost function for 1957–1997. Empirical results show that the cost reduction effects were fairly large. The Hicksian (1932) biases were found to be: (i) livestock-augmenting; (ii) labor- and other-inputs-saving; and (iii) machinery- and intermediate-inputs using. Except for other inputs, the directions of the biases are consistent with the Hicksian (1932) induced innovation hypothesis, which supports the public-sector-induced-innovation model proposed by Hayami and Ruttan (1985) and Ohtsuka (1982).     

基于灰色关联的南京市空气质量主要影响因素的分析

利用江苏省南京市空气质量的监测资料,采用空气质量指数（AQI）和灰色关联分析（GRA）等评价和分析方法,研究了南京市近十年（2003—2013年）空气质量的影响因素。结果表明：①城市人口密度对南京市空气质量的影响程度最低;②建成区绿化覆盖率、SO2排放量、工业烟尘排放量和人均公共绿地面积对南京市空气质量的影响最显著;③优先改善绿化情况和控制工业污染物的排放有利于总体提高南京市空气质量。     

Judging the probability of a contingent loss: An empirical study*

Abstract. This paper reports the results of research in which experienced auditors interpreted the criteria of Statement of Financial Accounting Standards No. 5 (SFAS 5): Accounting for Contingencies. The research focuses on two issues: (1) the nature and degree of consensus in the auditors' interpretations, and (2) the extent to which these interpretations depend upon the type of contingent loss. Forty-five experienced auditors (managers, principals, and partners) from “Big 8” CPA firms responded to a research instrument that elicited their interpretation of SFAS 5 probability criteria. Our analysis focuses upon the thresholds between the “remote” and “reasonably possible” criteria and between the “reasonably possible” and “probable” criteria. Our results indicate: (1) threshold means of 0.16 and 0.68, respectively; (2) more auditor consensus for the first threshold than for the second; (3) the first threshold was significantly lower than indicated by previous research; and (4) the thresholds were generally not dependent upon the type of contingent loss.     

Do People Accurately Anticipate Sanctions?

We provide lab data from four different games that allow us to study whether people have accurate expectations regarding monetary sanctions (punishment/reward) and nonmonetary sanctions (disapproval/approval). Although the strength of the sanction is always predicted with some error (particularly in the case of monetary sanctions), we observe that (i) most subjects anticipate correctly the sign of the average sanction, (ii) expectations covary with sanctions, (iii) the average expectation is very often not significantly different than the average actual sanction, and (iv) the errors exhibit no systematic bias, except in those situations where rewards are frequent. In this line, we find some evidence that punishment is better anticipated than rewards.     

On the demographic realism of the Ricardian theory of public finance

Summary The possibility of public debt-neutrality is discussed for countries experiencing demographic changes. The heterogeneity of agents plays a decisive role in destroying Ricardian equivalence of public finance. In addition to the usual explanatory factors of non-neutrality, such as distortionary taxation, public debt is not equivalent to current taxation as a consequence of (1) disconnected dynasties, (2) uncertain lifetimes, (3) diverging birth rates, (4) international migration, (5) population growth uncertainty, (6) diverging rates of time preference, and (7) capital market imperfections. The paper concludes that thepure Ricardian model of public finance serves a purpose as a standard of argument for the more realistic models of public finance.Comments by Gerbert Hebbink, Evert van Imhoff, Herman Vollebergh and members of the Department of Public Finance are gratefully acknowledged.     

Discussion of “Optimal Conservatism with Earnings Manipulation”

In this discussion, I briefly summarize the key features of Bertomeu, Darrough, and Xue's (hereafter BDX) model. I then examine the four key assumptions that BDX employ to arrive at their results: (i) firms contract only on earnings; (ii) conservative earnings are better for contracting; (iii) conservatism motivates upward earnings manipulation; and (iv) conservatism is endogenous. I then briefly conclude.     

The effect of financial deepening on inequality: Some international evidence

This paper uses an unbalanced panel data analysis of 126 countries for the period 1963–2002 to analyze the effects of financial deepening on inequality. The principal findings can be summarized as follows: (1) financial deepening reduces inequality; (2) economic growth reduces the equalizing effects of financial deepening; (3) inequality increases with an increase in trade openness; (4) the disequalizing effects of trade openness decrease as a country grows; (5) financial deepening and trade openness therefore have asymmetric effects on inequality; and (6) these effects are robust to the choice of financial variables, inequality measures, and model specifications.