Fixed Exchange Rates and Disinflation in Emerging Markets: How Large Is the Effect?

We examine developing countries which have institutional quality ratings for the effects of exchange rate rigidity on inflation. The level of institutional development exerts no effect on the impact of currency regimes. However, the interaction of institutional quality and exchange rates has, in the most plausible specifications, a negative impact on inflation. This suggests that fixed exchange rates exert at most a contingent effect on inflation, and indicates that countries in Eastern Europe and Latin America contemplating currency pegs would be better off improving institutional quality prior to adopting the euro or dollar and expecting a large subsequent disinflationary effect. JEL no.  F31, O11     

Towards a complete real-time electricity market design

The general design for the real-time electricity market presented in this paper optimizes and prices both real and reactive power simultaneously in an AC setting, where all assets—generation, load and transmission—are allowed to bid and are financially settled at the locational price times energy consumed or produced. The result is that transmission lines are compensated for both capacity and admittance, providing incentives for efficient operation of transmission-related assets such as FACTS devices, if price-taking behavior is assumed. Losses are incorporated into the design and become an operating cost for transmission. The market design is shown to be revenue neutral and, under some assumptions, nonconfiscatory.      

The impact of regulation on market risk

While it is crucial to understand the impact of regulatory changes on market risk, the literature does not show how risk responds to expected regulatory changes that are specifically designed to change risk. Our paper fills this gap by providing a detailed study of one such case. Using both a sample of privatized U.K. companies, and U.K. and U.S. control portfolios, between 1993 and 2000, we show (both for the single-factor market model and the three-factor Fama-French model) that the observed changes in market risk are significant and consistent with theory.     

Trends in Disaggregated Import and Export Prices in Europe: Implications for the Trade and Wages Debate

We consider carefully the evidence from traded prices (as proxied by unit values) concerning the transmission of the effects of globalisation to domestic labour markets. Using standard index number techniques we decompose changes in sectoral import and export unit values into movements due to changes in pure prices of the initial bundle of goods imported or exported and changes due to upgrading of that bundle. Looking at the imports of selected European countries of textiles, clothing and footwear relative to engineering products we find evidence of strongly falling pure prices of the unskilled intensive products relative to the skilled products in the 1980s. This reinforces the view that import prices can capture the impact of globalisation in terms of falling relative prices for products produced with the intensive use of unskilled labour. However, the trends are not common across all the unskilled sectors; footwear is clearly an exception. In the absence of detailed domestic data, we look for reactions by domestic firms to increased import competition in movements in the price and composition of exports. We find evidence of stiff price competition from imports being associated with similar movements in export prices and no support for the view that import competition from low–wage countries has led to upgrading of the quality of exports.     

The Returns to Academic and Vocational Qualifications in Britain

This paper uses data from the 1991 sweep of the National Child Development Study (NCDS) and the 1998 Labour Force Survey (LFS) to provide a comprehensive analysis of the labour market returns to academic and vocational qualifications. The results show that the wage premia from academic qualifications are typically higher than from vocational qualifications. However, this gap is reduced somewhat, when we control for the amount of time taken to acquire different qualifications. This is particularly important for vocational courses, which generally take shorter time periods to complete. In the paper we also investigate how returns vary by gender, subsequent qualifications, and the natural ability of individuals. Finally, by comparing the NCDS results with those from the LFS, we estimate the bias that can result from not controlling for factors such as ability, family background and measurement error. The results reveal that the estimated returns in the NCDS equations controlling for ability, family background and measurement error are similar to the simple OLS estimates obtained with the LFS, which do not control for these factors. This suggests that the biases generally offset one another.     

Komplexität erfolgreich steuern — 27. Österreichischer Controllertag in Wien

Ohne Zusammenfassung