A residual inaccuracy measure based on the relevation transform

Inaccuracy and information measures based on the cumulative residual entropy are useful in various fields, and are attracting increasing attention in Probability Theory and Statistics. In this paper, we introduce and study an inaccuracy measure concerning the relevation transform of two nonnegative continuous random variables. We investigate various distributional properties and characterization results that are based on the mean residual lifetime and involve the generalized Pareto distribution. A connection with the proportional hazards model is also provided. We obtain comparison results involving the proposed inaccuracy measure and some existing inaccuracy measures. Some illustrative examples are finally given.     

Regulating the Platform Economy: How to Protect Workers While Promoting Innovation

The rise of the platform economy has made it a topic of great interest among European policymakers, as evidenced by the European Commission’s 2016 Communication “A European agenda for the collaborative economy”. The regulatory challenges facing policymakers are manifold, ranging from taxation to competition policy to worker protection. Furthermore, many basic aspects of the platform economy are unclear, such as its size, the number of workers who take part in it and, indeed, its very definition. What types of regulation are necessary to ensure that the benefits of the platform economy are maximised for all Europeans? How can the productivity gains associated with the platform economy be distributed throughout society? Perhaps most importantly, how can policymakers support innovation while also protecting consumers, workers and communities?     

Collaborative Economy: Market Design and Basic Regulatory Principles

The rise of the collaborative economy platforms reveals that policymakers need to start thinking about how to introduce flexibility in the provision of services in these formal relationships with adequate protection for all of the involved parties.     

Sources of business-cycle volatility: An exploratory study on a sample of OECD countries

This paper investigates the sources of output volatility in twenty-four OECD economies using annual data from the 1960 to 1990 period. The paper finds that output volatility is positively related to the volatility of the money supply and the variance of the Solow residual, but negatively related to government size. The degree of openness of the economy and the exchange rate flexibility are also positively related to the size of business fluctuations, while price flexibility and industrial structure have no effect on output volatility. These results shed some light on the issue of the sources of business cycles.     

Is the Middle East an Optimum Currency Area? A Comparison of Costs and Benefits

This paper examines the macroeconomic costs and benefits of adopting a common currency for 13 Middle Eastern countries. Economic theory suggests that the main benefit is enhanced price stability, while the main cost is higher business-cycle volatility if the member country’s output is not sufficiently correlated with the area’s, as a whole. Using data from 1980–2005, the paper finds that the estimated cost and benefit measures exhibit substantial variability across the countries and are sometimes positively correlated. Moreover, focusing on the results for the last decade, it seems that many Middle Eastern countries (such as Bahrain, Kuwait, Libya, Oman, Qatar, Saudi Arabia, Syria and United Arab Emirates) have achieved remarkable convergence both in business-cycle synchronization and inflation outcomes.

Forecast rationality and monetary policy frameworks: Evidence from UK interest rate forecasts

We find evidence of heterogeneity and irrationality among professional forecasts for three-month inter-bank rates and ten-year gilt yields at both short and long forecast horizons over the period 1989-2006. The majority of biased forecasts overestimate the future spot rate, consistent with slow adjustment to the declining trend in inflation and interest rates. Furthermore, we produce evidence indicating that both monetary policy actions and elements of communication policy have information content regarding the rationality of forecasts. Changes in official bank rates and disagreement among the Monetary Policy Committee influence the rationality of forecasts. The publication of inflation reports has no effect.     

Long-Run Purchasing Power Parity and Structural Change: The Official and Parallel Foreign Exchange Markets For Dollars In Greece

This paper examines the Purchasing Power Parity theory from a long-run perspective in the presence of a parallel or 'black' market for US dollars in Greece using monthly data for the recent float. Johansen's FIML multivariate cointegration techniques is applied. Recent development associated with this procedure are considered. First, a formal test developed by Paruolo (1996) for the presence of I(2) and I(1) components in a ultivariate context is applied along with the estimation of the roots of the companion matrix for the correct determination of the cointegration rank. Second, given that two significant cointegration vectors were found, structural restrictions identifying the long-run relations of interest are specified as proposed by Johansen and Juselius (1994) and Johansen (1995b). Thus, the joint structure of PPP and long-run informational market efficiency could not be rejected. Furthermore, estimation of the error correction terms shows that the black market rate adjusts to eliminate any deviation from long-run PPP. Finally, stability tests proposed by Hansen and Johansen (1993) are applied and it is shown that the dimension of the cointegration space is simple dependent while the estimated coefficients do not exhibit instability in recursive estimations. [F31 F33]     

Cointegration Tests Of The Monetary Exchange Rate Model: The Canadian—U.S. Dollar, 1970 – 1994

Using data on the Canadian-U.S. dollar rate, we reexamine the monetary model of exchange-rate determination for the recent float in three ways. First, we test its long-run validity, using Johansen's multivariate cointegration techniques. Second, we examine and test the model for the presence of speculative bubble, and finally we test for parameter stability of Johansen's results using the Hanse-Johansen recursive tests. [F31]