Egalitarianism: An evolutionary perspective

Two parties bargain over a pie, the size of which is determined by their previous investment decisions. Investment costs are heterogenoeus. The bargaining rule is sensitive to investment behavior. Our main result is that egalitarianism is more likely to emerge in situations in which private property over the fruits of one's own independent investment is not secured.     

Multiple attractors and global bifurcations in a Kaldor-type business cycle model

We consider a Kaldor-type discrete-time nonlinear business cycle model in income and capital, where investment is assumed to depend both on the difference between normal and current levels of capital stock, and on the difference between the current income and its normal level, through a nonlinear S-shaped increasing function. As usual in Kaldor business cycle models, one or three steady states exist, and the standard analysis of the local stability and bifurcations suggests that endogenous oscillations occur in the presence of only one unstable equilibrium, whereas the coexistence of three equilibria is characterized by bi-stability, the central equilibrium being on the boundary which separates the basins of the two stable ones. However, a deeper analysis of the global dynamic properties of the model in the parameter ranges where three steady states exist, reveals the existence of an attracting limit cycle surrounding the three steady states, leading to a situation of multistability, with a rich and complex dynamic structure.     

Fiscal Policies and Credit Regimes: A TVAR Approach

This work investigates how the state of credit markets affects the impact of fiscal policies. We estimate a threshold vector autoregression (TVAR) model on US quarterly data for the period 1984–2010. We employ the spread between BAA‐rated corporate bond yield and 10‐year treasury constant maturity rate as a proxy for credit conditions. We find that the response of output to fiscal policy shocks is stronger and more persistent when the economy is in the ‘tight’ credit regime. Fiscal multipliers are significantly different in the two regimes: they are abundantly and persistently higher than one when firms face increasing financing costs, whereas they are feebler and often lower than one in the ‘normal’ credit regime. The results appear to be robust to different model specifications, fiscal foresight, alternative threshold variables, different measure of variables and sample periods. Copyright © 2014 John Wiley & Sons, Ltd.     

Modelling and forecasting stock returns: exploiting the futures market,regime shifts and international spillovers

This paper proposes a vector equilibrium correction model of stock returns that exploits the information in the futures market, while allowing for both regime‐switching behaviour and international spillovers across stock market indices. Using data for three major stock market indices since 1989, we find that: (i) in sample, our model outperforms several alternative models on the basis of standard statistical criteria; (ii) in out‐of‐sample forecasting, our model does not produce significant gains in terms of point forecasts relative to more parsimonious alternative specifications, but it does so both in terms of market timing ability and in density forecasting performance. The economic value of the density forecasts is illustrated with an application to a simple risk management exercise. Copyright © 2005 John Wiley & Sons, Ltd.     

THE INVESTMENT GAME WITH ASYMMETRIC INFORMATION

We analyze the effects of introducing asymmetric information and expectations in the investment game ( Berg et al., Games and Economic Behavior, 1995 , 10, 122–42). In our experiment, only the trustee knows the size of the surplus. Subjects’ expectations about each other's behavior are also elicited. Our results show that average payback levels increase with the average amount sent. Asymmetric information does not reduce the amounts sent and returned, as compared with previous experimental studies. The first movers’ choices increase with their expectations about the second movers’ payback, whose choices depend in turn on the difference between expected and actual amounts received.     

Extending the Classification of European Countries by their IFRS Practices: A Research Note

Abstract

This paper expands the IFRS accounting systems’ classification proposed by Nobes [(2011). IFRS practices and the persistence of accounting system classification. Abacus, 47(3), 267–283] to a broader set of European countries. The results suggest a classification distinguishing between four groups of European countries, and add to the evidence, reported by Kvaal and Nobes [(2010). International differences in IFRS policy choice. Accounting and Business Research, 40(2), 173–187] and Nobes (2011)., that pre-IFRS accounting differences influence the options adopted by firms. This study contributes to the literature suggesting that the widespread adoption of IFRS has not eliminated the differences between national accounting practices and that accounting systems classification did not lose its relevance.     

GDP steady-state multipliers under monopolistic competition revisited

New Keynesian general-equilibrium static models showed the fiscal multiplier is an increasing function of the degree of monopoly. Here, I develop a simple intertemporal model allowing us to study the steady-state role of optimal capital stock (and depreciation) in the fiscal policy transmission mechanism. The GDP multiplier may be locally decreasing in the degree of monopoly when the number of firms is fixed, but results depend strongly on the set of parameter values chosen. Using a net-output definition or allowing for free entry leads to unambiguous dominance of the long-run monopolistic multiplier over the Walrasian one.