There’s Much Ruin in a Nation: An Analysis of Modern Monetary Theory

Atlantic Economic Journal - This paper analyzes the first macroeconomic textbook based on modern monetary theory (MMT) written by Mitchell, Watts and Wray. MMT is a heterodox theory that a...     

2016 Election’s Effect on Energy Sector Wealth and Political Strategies

Atlantic Economic Journal -     

Inflation and Economic Growth in China： An Empirical Analysis

Using official provincial data for gross provincial product, consumer price index and other explanatory variables from 1986 to 2006, the present paper investigates the nonlinear effects of inflation on economic growth in China. The main finding of the study is that the inflation threshold effect is highly significant and robust in China. Above the 2.50 percent threshold, every 1‐percentage point increase in the inflation rate impedes economic growth by 0.61 percent; below this threshold, every 1‐percentage point increase in the inflation rate stimulates growth by 0.53 percent. This indicates that high inflation harms economic growth, whereas moderate inflation benefits growth. We suggest that China should maintain a moderate inflation rate for long‐run growth.     

Analysis of Effect of Property Rights on China＇s Reform

This paper analyzes the effect of property fights institution to reform of China from the angle of the three meanings of property fights. The second and the third meaning are emphasized. The thesis points out that state-owned enterprise is an institutional arrangement in the pre-reform age of China. The agent of state-owned enterprise just has part of the property fights to operate the property, So the institution is lack of stimulation to the agent. The result is low efficiency of state-owned enterprise. Furthermore, social resources are wasted, and the economy grows slowly. The conclusion is that clear and complete institution of property rights will guide resources to effective allocation, and accelerate the progress of reform in China.     

Trump’s Effect on the Chinese Stock Market

U.S. President Donald J. Trump tweets frequently to communicate his thoughts to the public. We quantitatively evaluate the impact of Trump's China-related tweets on the Chinese stock market. We find that following Trump’s inauguration, his tweets with a positive sentiment significantly increase abnormal returns for the manufacturing industry in the Chinese stock market. Furthermore, an increase in the absolute value of his positive sentiment increases both the trading volume and volatility of the market. The positive effect is more pronounced for those subindustries with high exposure to international trade and stronger business relations with the United States than for other subindustries. The results are robust for various sensitivity tests.     

Pass-through Effects of Global Commodity Prices on China＇s Inflation： An Empirical Investigation

The present paper uses a two-step approach to estimate the pass-through effects of changes in international commodity prices and the RMB exchange rate on domestic consumer price inflation in China. We first estimate the pass-through effects of international commodity prices on producer prices and then estimate the pass-through effects of producer price inflation on consumer price inflation. We find that a l O-percent increase in international commodity prices would lead to China＇ s producer prices increasing by 1.2 percent 3 months later, which in turn would increase China＇ s domestic inflation by 0.24 percent over the same period. However, a 10-percent appreciation of the RMB exchange rate against the US dollar would help to reduce increases in producer prices by 4.4 percent over the following 3 months, which in turn would lead to a 0. 89-percent decline in consumer price inflation over the same period. Our findings suggest that appreciation of the RMB in an environment of rising global commodity prices and a weak US dollar could be an effective instrument to help contain inflation in China.     

An Economic Analysis on Telecommunication Universal Service

Telecommunication universal service means the obligation of an operator to provide all users with a series of basic services of good quality at affordable rates. It is a key issue of regulatory policies in the telecommunication industry. This paper discusses some important problems such as the necessity of universal service, expansibility on implication of universal service, financing mechanism and auction universal service by providing an economic analysis framework.     

Monetary Policy in Austria–Hungary, 1876–1913: An Econometric Analysis of the Determinants of the Central Bank’s Discount Rate and the Liquidity Ratio

This paper presents a model to explain the official discount rate of the Central Bank of Austria–Hungary from 1876 to 1913. The discount rate is assumed to depend on the liquidity ratio of the Bank, defined as the ratio of its stock of metals to banknotes issued, and on changes in foreign discount rates. The paper also presents an equation explaining the liquidity ratio. We use “not equally spaced chronologically ordered data” referring to the 50 discount rate changes enacted. The regressions confirm that the liquidity ratio was the main determinant of the discount rate and that Germany (and not Great Britain) played a significant role in determining the Austro–Hungarian discount rate and the liquidity ratios, supporting the view that the classical gold standard was a decentralized multipolar system rather than a system fully dominated by London as suggested by Keynes. The regressions also suggest that, although Austria–Hungary had an inconvertible paper currency (1879–1892) and fluctuating exchange rates (1876–1895) and formally joined the gold standard only in 1902, it “shadowed” the behaviour of gold standard Central Banks with such consistency that the stability of the estimated regressions was relatively unaffected by the frequent institutional changes.

Analysis on the Hero’s Abnormal Psychology in The tell-tale heart

The Tell-Tale Heart is one of the horror stories of Edgar Allan Poe's, who was a master of the horror tale in American. The hero in this story is always afraid of the eyes of an old man. He is extreme anxiety under the eyes, for avoiding this anxiety, he kills the old man. This paper is to analyze the hero's abnormal psychology.     

Effect of the ruble exchange rate on Russia’s economic activity

In this paper, we present and analyze our estimates of the effect of changes in the real ruble exchange rate on economic growth in Russia and on the output in various sectors of the Russian economy and provide a review of domestic and foreign studies investigating these indicators.     

What Causes China＇s High Inflation？ A Threshold Structural Vector Autoregression Analysis

China＇s astonishing economic growth implies a necessity to understand its inflation. The present paper employs threshold nonrecursive structural vector autoregression analysis to explore the asymmetric effects of macro-variables on inflation in low and high inflation regimes. The empirical evidence demonstrates, first, that the reactions of inflation to various shocks are inflation-regime-dependent and asymmetric. Second, monetary policy influences China ＂s high inflation and adjusting the domestic interest rate in China may be an effective way to control inflation in a high inflation regime, but not in a low inflation regime. In a high inflation regime, a high inflation rate may cause the macro-policy authorities to increase the domestic interest rate, in an attempt to stabilize high inflation. Third, contrary to expectations, the world oil price is not a strong cost-push factor in a low inflation regime. Oil price increases may increase inflation in a high inflation regime, but there is no such obvious effect in a low inflation regime. Finally, China ＂s nominal effective exchange rate influences inflation in both low and high inflation regimes. A nominal effeetive exchange rate appreciation might be effective in controlling domestic inflation in both regimes.     

Japan’s quantitative monetary easing policy: Effect on the level and volatility of yield spreads

We examine the effects on the level and volatility of yield spreads of the Quantitative Monetary Easing Policy (QMEP) of the Bank of Japan (BoJ) implemented from March 19, 2001 to March 9, 2006. We adopt an Exponential Generalized Autoregressive Conditional Heteroskedasticity (EGARCH) model to analyze daily data for the five year duration of QMEP. The purpose of QMEP was to reduce short-term interest rate expectations with the goal of bringing down long term interest rates to stimulate the economy. Under QMEP, the operational target of monetary policy was taken as the current account balances (CABs) of financial institutions held at the BoJ. In support of QMEP effectiveness, we find that the policy to raise CABs was indeed associated with a decrease in yield spreads across all maturities. At the same time, the policy may have increased the volatility of yield spreads at short and medium time horizons, perhaps due to unevern demand for government security issues that nevertheless left confidence in the future of low interest rates intact. Preserving liquidity at or above the CABs target range was found to decrease yield spreads.     

Research on the Stock Price Transmission of China＇s Monetary Policy

With the further development of the economic reform of China, the stock price in the monetary policy transmission deserves more and more attention of the experts and the scholars. This paper studies the stock price transmission theory in the monetary policy transmission, analyzes the problems of the stock price transmission in China, and in the end, puts forward some advice on policy for the purpose of exerting effectively the influence of China＇s stock price in the monetary policy transmission.     

Analysis of CEPA＇s Impact on CAFTA

This paper discusses the different effects of CEPA and CAFTA on China＇s participation of regional economic integration. Then it analyses the two impact mechanisms of CEPA on CAFTA： amending the similarity of industry structure of China and ASEAN; acting as a proving ground for regional economic cooperation of CAFTA.     

Spread between the Moody’s Aaa-Rated Corporate Bond Yield and the Yield on Municipals: Co-integration Analysis

Atlantic Economic Journal - While the research linking interest rates to government deficits is extensive, the impact of other tax-related variables is uncommon. This study seeks to add to the...