Giving is a Question of Time: Response Times and Contributions to an Environmental Public Good

Does it matter whether contribution decisions regarding environmental public goods are arrived at through intuition or reflection? Experimental research in behavioral economics has recently adopted dual-system theories of the mind from psychology in order to address this question. This research uses response time data in public good games to distinguish between the two distinct cognitive processes. We extend this literature towards environmental public goods by analyzing response time data from an online experiment in which over 3400 subjects from the general population faced a dichotomous choice between receiving a monetary payment or contributing to climate change mitigation efforts. Our evidence confirms a strong positive link between response times and contributions: The average response time of contributors is 40 % higher than that of non-contributors. This suggests that reflection, not intuition, is at the root of pro-environmental contributions. This result is robust to a comprehensive set of robustness checks, including a within-subjects analysis that controls for potentially unobserved confounds and recovers the relationship at the individual level.     

Testing the shift adjustment in the federal reserve's new shift adjusted M1-B

The Federal Reserve's estimates of the shift into M1-B from savings and other non-demand deposit sources following the legalization of NOW accounts nationwide in January, 1981 are tested formally. The results indicate that the Fed's estimates cannot be rejected on formal statistical grounds. However, there is some evidence that the Fed may have overestimated the shift.     

Does EMU need stage two?

The Delors Committee’s three stage plan for attaining European Economic and Monetary Union has met with heavy criticism and has given rise to various counter-proposals. The following article examines the relative merits and shortcomings of the Delors Plan and the alternative concepts presented by the Deutsche Bundesbank and the British Government.     

Sustaining growth in agriculture: a quantitative review of agricultural research investments

Growth in agriculture depends on many things but one of the most important is investment in agricultural research. Decision making in the agricultural research policy area can only be aided by access to better information. This article overviews a recent endeavor to move policy dialogue beyond merely qualitative impressions towards a process that is underpinned with new and cogent data. The data used have been assembled at ISNAR in a manner designed to make comparisons both over time and between countries more valid than has been the case in the past. The comparisons thus possible reveal considerable diversity both between countries and between broad regional aggregations. Also illuminated here are issues related to the commodity orientation, capital and labor intensity, and size and scope of particular national programs.     

Adaptivity and stability of time series models

The effect of interventions on economic variables in the presence of a time dependent noise structure is modelled in this paper. Forecasts from such models are derived and it is disscussed whether forecasts from ARIMA time series models are adaptive with respect to interventions such as changes in the level or outliers.An overall criterion to test the stability of the parameters in ARIMA models is derived and applied to three Austrian macroeconomic sequences.

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Zusammenfassung Bei der Schätzung und vorhersage von ökonomischen Zeitreihen werden in der Regel konstante Parameter unterstellt. In dieser Arbeit werden verschiedene Aspekte dieser Annahme untersucht.Zuerst werden Modelle beschrieben, durch die die Wirkung von Interventionen auf ökonomische Zeitreihen dargestellt werden kann. Es wird mit Hilfe dieser Modelle untersucht, in wie weit die Vorhersagen von ARIMA Zeitreihenmodellen gegenüber Interventionen (wie Ausreißer und Änderungen im Niveau) adaptiv sind. Ferner wird ein statistisches Kriterium abgeleitet, das die Stabilität der Parameter in ARIMA Zeitreihenmodellen testet. Dieser Test wird an Hand von drei ökonomischen Reihen beschrieben. Es wird gezeigt, daß sich die Parameter in den mit Daten bis 1974/3 geschätzten Zeitreihenmodellen für privaten Konsum und Brutto-Anlageinvestitionen über die folgenden 9 Quartale nich geändert haben. Für das Brutto-Nationalprodukt kann die Annahme konstanter Parameter verworfen werden. Die Vorhersagefehler der letzten 9 Quartale ermöglichen es jedoch, ein einfaches Interventionsmodell zu spezifizieren.

     

Equilibrium returns with transaction costs

We study how trading costs are reflected in equilibrium returns. To this end, we develop a tractable continuous-time risk-sharing model, where heterogeneous mean–variance investors trade subject to a quadratic transaction cost. The corresponding equilibrium is characterized as the unique solution of a system of coupled but linear forward–backward stochastic differential equations. Explicit solutions are obtained in a number of concrete settings. The sluggishness of the frictional portfolios makes the corresponding equilibrium returns mean-reverting. Compared to the frictionless case, expected returns are higher if the more risk-averse agents are net sellers or if the asset supply expands over time.     

From the ERM with Love: Monetary Spillover Effects to Austria

In this article, I examine the impact of domestic and European-wide monetary factors on Austrian inflation within the context of an extended version of the traditional P*-framework over the period 1973.I–1997.IV. The estimations suggest that the relative importance of national and European monetary conditions for detecting future price trends in Austria has shifted in favour of the latter variable in the course of time. Hence, long before Austria decided to join the ERM, its rate of inflation appears to be mainly driven by monetary factors abroad. The credible hard currency concept of the Austrian monetary authorities together with the strong European orientation of Austria is presumably largely responsible for this. From Austria's point of view, the results also seem to provide preliminary support for the use of European monetary aggregates in the formulation of monetary policy in Stage Three of EMU.     

Labor Market Effects of Economic Integration: The Impact of Re-Unification in German Border Regions

Abstract. This paper exploits the significant reduction in impediments to labor mobility in the process of German re-unification in order to identify labor supply shocks in the West German labor market. The focus is on the quasi-experiment of the border removal in the regions situated at the German–German border that faced a massive increase of cross-border labor supply. The results indicate that despite a gain in employment, the border removal was accompanied by a decline in wages and an increase in unemployment relative to other West German regions.