Carbon Trading with Imperfectly Observable Emissions

The Kyoto Protocol foresees emission trading but does not yet specify verification of (uncertain) emissions. This paper analyses a setting in which parties can meet their emission targets by reducing emissions, by investing in monitoring (reducing uncertainty of emissions) or by (bilaterally) trading permits. We derive the optimality conditions and carry out various numerical simulations. Our applications suggest that including uncertainty could increase compliance costs for the USA, Japan and the European Union. Central Europe and the Former Soviet Union might be able to gain from trading due to higher permit prices. Emissions trading could also lower aggregate uncertainty on emissions.     

Optimization of Harvesting Return from Age-Structured Population

Synopsis Maximization of the net profit from harvesting in a one-species age-structured population is analyzed. One of the control functions is the age of harvested individuals. The constructed mathematical model is similar to vintage capital models used in economics for optimal capital replacement. The optimization technique developed by authors for the capital replacement is disseminated to the formulated problem. A qualitative analysis of the problem is provided and the interpretation of results is given. Such economic topics as a zero-investment period, optimal balanced growth, and turnpike properties are discussed.     

Cyclical growth in a Goodwin–Kalecki–Marx model

This paper presents a disequilibrium macrodynamic model that incorporates certain elements from Goodwin (the dynamics of the rate of employment and income distribution), Kalecki (an investment function independent of savings, and mark-up pricing in oligopolistic goods markets), and Marx (the reserve-army and reserve-army-creation effects). The model has a system of differential equations for the rate of utilization, profit share, and rate of employment. We show that there exist limit cycles that depend on the sizes of the reserve-army effect and reserve-army-creation effect. This implies that there exists a situation in which the economy experiences endogenous and perpetual growth cycles. Moreover, we show that if the stable long-run equilibrium corresponds to the profit-led growth regime, an increase in the bargaining power of workers increases the rate of unemployment; conversely, if the equilibrium corresponds to the wage-led growth-regime, an increase in the bargaining power of workers decreases the rate of unemployment.     

Shift of the short-term temperature mortality relationship by a climate factor - some evidence necessary to take account of in estimating the health effect of global warming

Several studies have reported a 'V'-shaped relationship between short-term temperature and mortality rates, characterized by mortality rates that are higher when the temperature is extremely low or high than when the temperature is moderate. To quantify the effect of adaptation to a certain climate on this V-shaped short-term temperature-mortality relationship, we studied the prefecture-specific relationship between daily maximum temperature and mortality rates for 65+-years-old Japanese from 1972 to 1990. For both genders, the optimum daily maximum temperature (OT) category at which the mortality rate was minimum ranged from 23C-28 C to 33+C, and the OT level became lower when the climate became colder. The mean OT level was lower for women than for men by 1.7C. The mortality rate at the OT was almost constant across prefectures, regardless of the climate. From the results, we considered that the adaptation effect on the short-term temperature-mortality relationship is mainly described by the 'horizontal shift model': the V-shape moves horizontally according to the climate. This 'shift' should be taken into account in estimating the health effect of global warming, and the model would be useful for the estimation.     

THE IMPORTANCE OF THE RETENTION RATIO IN A KALECKIAN MODEL WITH DEBT ACCUMULATION

By using a Kaleckian model with debt accumulation, Hein (2007; Metroeconomica, 56 (2), pp. 310–39) found that the long‐run equilibrium value of the debt–capital ratio is positive and stable only if interest rates are extremely high and if the short‐run equilibrium exhibits the ‘debt‐led’ growth regime. However, this conclusion crucially depends on the assumption that the retention ratio of firms is equal to unity. By relaxing this assumption, we show that there exists a positive and stable long‐run equilibrium even under the ‘debt‐burdened’ regime without any constraint on the nominal interest rate.     

Small transaction costs, absence of arbitrage and consistent price systems

The aim of this note is to establish a criterion of absence of arbitrage opportunities under small transaction costs for a family of multi-asset models of financial markets.     

The Impact of Agricultural Import Tariff on Economic Growth： Evidence From Mercosur Countries

This research paper attempts to determine the relationship between agricultural import tariff and economic growth of Mercosur countries over the period 1996-2007 using regression analysis as well as evaluates the gains and losses from the group＇s trade policy over the same period. The introductory part of this paper focuses on the dynamics of changes in economic growth, trade, and import tariff of these countries over the last two decades. The results of the performed regression analysis of panel data suggest that trade liberalization has a quantitatively significant positive effect on growth. By using the coefficient estimates on tariff, the authors perform a quantitative evaluation of gains and losses from trade policy, for which tariff measures to trade （imports） are used as a proxy.     

International Competition and Distributive Class Conflict in an Open Economy Kaleckian Model

This paper constructs an open economy Kaleckian model in which international competition affects the bargaining process between firms and workers, and investigates the effects of such bargaining on the macroeconomy. We show that the effects of a change in the bargaining power on aggregate demand depends not only on the demand regimes but also on which agents bears more of the burden arising from the international price competition. Moreover, if the real exchange rate has a small impact on the trade balance, the economy is stable, whereas if it has a larger impact on the trade balance, the economy is unstable.     

The dynamics of immigrant participation in entitlement programs: evidence from Canada, 1993–2007

Abstract Using uniquely rich Canadian administrative data from the 1993–2007 period, I find no evidence of rising Employment Insurance (EI) participation across recent‐immigrant cohorts and no evidence of rising EI participation with number of years spent in Canada beyond the short period following entrance into the Canadian labour market. I also find little evidence of the rising immigrant participation in Social Assistance (SA), either across recent arrival cohorts or with years in Canada. The results do not appear to be seriously affected by emigration and attrition within each immigrant cohort. While the immigrant participation in traditional ‘welfare’ programs such as Social Assistance has generally declined from 1993 to 2007, I show that Canada Child Tax Benefit and other federal and provincial programs aimed at providing financial assistance to families with children have become a major source of transfer income to immigrant families.