On Bayesian routes to unit roots

This paper is a comment on P. C. B. Phillips, ‘To criticise the critics: an objective Bayesian analysis of stochastic trends’ [Phillips, (1991)]. Departing from the likelihood of an univariate autoregressive model different routes that lead to a posterior odds analysis of the unit root hypothesis are explored, where the differences in routes are due to the different choices of the prior. Improper priors like the uniform and the Jeffreys prior are less suited for Bayesian inference on a sharp null hypothesis as the unit root. A proper normal prior on the mean of the process is analysed and empirical results using extended Nelson-Plosser data are presented.     

Identifying agroecological mixed farming strategies for local conditions in San Antonio de Los Baños,Cuba

Building on previous research at the experimental and national scales, this study was carried out at the local scale over a four-year period on three farms of reference: one specialized dairy farm ‘Vaquería 10’ (33.7 ha) and two mixed farms, ‘Remedio’ (9.4 ha) and ‘La Sarita’ (47 ha). All three farms are located in the San Antonio de Los Baños municipality, Havana, Cuba. This study illustrates the application of the Ecological Framework for the Assessment of Sustainability (ECOFAS). This methodology consists of a cyclical structure of six steps, aimed at guiding the process of implementing innovative mixed (crop–livestock) farming strategies. Local stakeholders (farmers, researchers, extension officers and representatives of the ministry of agriculture in the municipality) identified alternative strategies for agriculture in the region, based on the critical technological, environmental and socio-economic factors constraining the current performance of farming systems. The results show that implementation of ‘best practice’ mixed farming systems management strategies in the region potentially can lead to a strong positive impact on land productivity, food self-sufficiency as well as improve socio-economic performance.     

On the choice of the optimal industry

Zusammenfassung über die Auswahl der optimalen Industrie. Eine über-prüfung einer Kontroverse. — Die vorliegende Abhandlung überprüft zwei widersprechende Strategien bezüglich der Auswahl der Aktivit?t, die ein Einkommensziel optimiert, bei gebührender Berücksichtigung der Besch?ftigung, die von der Ausstattung mit Ressourcen und von technischen Beschr?nkungen abh?ngt. Gegenstand der Betrachtung ist die Volkswirtschaft, aber es wird auch der weltwirtschaftliche Zusammenhang berücksichtigt, in dem derartige Volkswirtschaften operieren. Der Aufbau des Aufsatzes ist folgender: Im ersten Kapitel wird das Problem zur Diskussion gestellt, im zweiten Abschnitt werden die beiden entgegengesetzten Strategien für die Auswahl des optimalen Sektors beschrieben. Im dritten Teil behandelt der Autor beide Strategien theoretisch, diskutiert ihre relativen Vorzüge und entscheidet sich zugunsten einer von beiden. Im vierten Teil wird die empirische Relevanz der vom Autor bevorzugten Strategie überprüft. Im fünften Teil werden die Regeln für die praktische Auswahl der optimalen Aktivit?t aufgrund der gew?hlten Strategien dargestellt und erl?utert. Die Abhandlung wird durch dasechste Kapitel beschlossen, das die gefundenen L?sungen kommentiert und mit einer Gesamtstrategie der industriellen Raumplanung vergleicht, die an anderer Stelle dargelegt wurde, um zu einer weltweiten Erkl?rung von Einkommens- und Besch?ftigungsfragen der beteiligten L?nder zu gelangen.

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Résumé De la sélection de l’industrie optimale. L’examination d’une controverse. — Dans cet article, on examine deux stratégies contradictoires pour choisir l’activité qui optimaliserait un projet de revenu, en tenant düment compte de l’emploi, qui dépend de l’équipement et des restrictions techniques. C’est l’économie nationale dont on s’occupe, mais on tiendra compte du contexte international dans lequel une telle économie opère. La disposition de l’article est la suivante: Dans la section I, on expose le problème, dans la section II, on décrit les deux stratégies contradictoires pour la sélection du secteur optimal. Dans la section III, l’auteur qualifie ces deux stratégies au point de vue théorique, en discutant leurs mérites relatifs et en se décidant pour l’une des deux. Dans la section IV, l’importance empirique de la stratégie choisie par l’auteur est examinée. Dans la section V, on indique et explique les règles pour la selection pratique de l’activité optimale suivant la stratégie choisie. L’article se termine avec la section VI, oú l’on commente les solutions, obtenues, tout en les comparant avec une stratégie générale de location industrielle, qui a été exposée ailleurs, afin d’arriver á une explication mondiale des problèmes de revenu et d’emploi dans les pays en question.

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Resumen Sobre la selección de la industria óptima. El examen de una controversia. — El présente estudio examina dos estrategias contradictorias con respecto de la actividad que optimiza la meta de ingreso, teniendo debidamente en cuenta el grado de empleo que dépende de la disposici?n de recursos y de restricciones técnicas. El objeto del análisis es la economla nacional, pero se considéra también el marco mundial en el que operan dichas economlas. El artfculo comprende las siguientes partes: En el primer capitulo se discute el problema; en el segundo cap?tulo se describen las dos estrategias contradictorias para la selección de un sector Optimo. En el tercer capitulo el autor analiza teóricamente ambas estrategias, discute sus ventajas comparativas y se decide por una de ellas. En el cuarto capitulo se examina la relevancia empirica de la estrategia escogida. En el quinto cap?tulo se presentan y explican las reglas a adoptar para la selección práctica de la actividad optima. El articulo concluye con un resumen de los resultados y una comparación con una estrategia general de planification regional (la cual fué presentada en otra parte) con el fin de llegar a una explicación de problemas de ingreso y de empleo en los paises en cuestión.

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Riassunto Sulla scelta dell’industria ottimale. La verifica di una controversia. — II présente articolo verifica due stratégie contraddittorie relative alla scelta dell’attivitá che ottimizza un obbiettivo di reddito, con dovuta considerazione dell’occupazione che dipende dalla dotazione con risorse e da limitazioni teeniche. Oggetto délia considerazione è l’economia, ma viene tenuto conto anche délia connessione économico-mondiale in cui operano économie di tal génère. La struttura dell’articolo è la seguente: Nel I capitolo è posto in discussione il problema, nel II capitolo sono descritte le due opposte stratégie per la scelta del settore ottimale. Nel III capitolo l’autore tratta teoreticamente le due stratégie, discuto i loro relativi pregi e si decide a favore di una délie due. Nel IV viene vagliata la rilevanza empirica délia strategia preferita dall’autore. Nel V sono rappresentate ed illustrate le regole per la scelta pratica dell’attivitá ottimale in base alle teorie scelte. Chiude l’articolo il VI capitolo che commenta le soluzioni trovate e le confronta con una strategia globale délia progettazione di spazio industriale, che fu esposta in altro luogo, per giungere ad una spiegazione di portata mondiale di questioni di reddito ed occupazione dei Paesi partecipanti.

     

A Test for Parameter Homogeneity in CO<Subscript>2</Subscript>Panel EKC Estimations

This paper casts doubt on empirical results based on panel estimations of an “inverted-U” relationship between per capita GDP and pollution. Using a new dataset for OECD countries on carbon dioxide emissions for the period 1960–1997, we find that the crucial assumption of homogeneity across countries is problematic. Decisively rejected are model specifications that feature even weaker homogeneity assumptions than are commonly used. Furthermore, our results challenge the existence of an overall Environmental Kuznets Curve for carbon dioxide emissions.     

The Information Content of Multiple Stock Splits

We examine the relationship between the frequency of stock splits and firms' motives for splitting their stock. Compared to their peers, infrequent splitters show higher post‐split operating performance, but not so for frequent splitters. We find that split ratio and liquidity change explain the stock split announcement effect for the frequent splitters. In contrast, the change in operating performance in the split year explains the announcement effect for the infrequent splitters. Our results suggest that frequent splits are more consistent with the trading range‐improved/liquidity hypothesis and infrequent splits are more consistent with the signaling hypothesis.     

A multivariate analysis of REIT performance by financial and real asset portfolio characteristics

This paper examines the risk-adjusted performance of real estate investment trusts (REITs) from 1986 through 1990 in relation to financial and property characteristics of their portfolios. The Sharpe measure of risk-adjusted rate of return was regressed against financial ratios and property investment ratios for a sample of equity and mortgage REITs. The results show that, in general, financial ratios (gross cash flow, leverage, asset size), regional location of properties, and types of real estate investments determine the risk-adjusted performance. More specifically, location of properties in the western United States, ownership of health care properties, and investment in securitized mortgages positively affect the risk-adjusted return. The individual financial variables were not found to be statistically significant in influencing REIT returns.     

Vertical De‐Integration in the Mutual Fund Industry: Using Knowledge as a Factor of Production

This paper extends the knowledge‐based view of the firm by using relative measures of two fundamental classifications of knowledge as factors of production. It relates differences in relative quantities of these classifications of knowledge to the probability that a given stage of production is outsourced or de‐integrated. The probability of de‐integration of adjacent stages of production is found to increase on increasing reliance on tacit knowledge and decreasing reliance on encapsulated knowledge. The research was motivated by the belief that the cost and value of knowledge, as a factor of production, influence economic efficiency. Copyright © 2014 John Wiley & Sons, Ltd.     

Lessons from the polder: Energy tax design in The Netherlands from a climate change perspective

This paper evaluates energy tax reform in The Netherlands between 1988 and 2002 from a climate change perspective. In particular, the introduction of two (indirect) taxes on energy products is now responsible for a considerable amount of tax revenue from a green tax base. The paper discusses the energy tax base and rate structure from a modern Pigovian tax perspective and illustrates the practical difficulties involved in the indirect and non-uniform taxation of emissions. Also further improvements of the energy tax structure are discussed, such as a better targeting of the energy tax base and tax rate to fuel characteristics.     

Intensification scenarios in south-western Niger: Implications for revisiting fertilizer policy

In semi-arid south-western Niger, external fertilizer inputs are a complement of livestock-mediated nutrient transfers for maintaining soil fertility. This paper discusses scenarios of intensification for different farm household types in an area representative of the wetter parts of semi-arid Sahel. Twenty-five-year projections suggest that soil fertility may not always or irreversibly deteriorate under intensification, and that nitrogen is the main external input required. Owning animals allows some households to achieve food security and maintain soil fertility by capturing and mobilizing soil nutrients. Intensification will bring various benefits to livelihoods, but these will be unevenly distributed. The results of this paper should caution scientists and policy-makers against the often heard warning of inevitable losses in soil fertility in the Sahel associated with intensive technologies, and against extrapolating conclusions attained at specific locations or social groups. Endogenous coping strategies based on using local inputs can also be effective and should be explored in addition to a continued attention for the need for more targeted uses of external inputs.     

Interpreting the Performance of Business Economists During the Great Recession

It is generally believed that the recession of 2007–09 was not foreseen by business economists. Is this perceived view accurate? We explore this issue by examining business economists’ published statements about economic conditions. We compare these qualitative forecasts with the Beige Book. We conclude that both sets of data are similar and that business economists are responsive to information about the economy and adjust their predictions quickly.