Restricted electricity use among poor urban households

For a variety of reasons, this article argues, electricity must be seen by policy‐makers in South Africa not as the sole provider of all future household energy needs, but rather as one component of an energy mix which includes such ‘transitional’ fuels as coal, gas and paraffin. The reasons for this are that electricity is expensive for poor households; it is subject to power failures and disconnections for non‐payment; the poor find it difficult to monitor and to control their consumption; appliances are expensive and several are required to make best use of electricity; people prefer other fuels because they are familiar and have strong personal and cultural associations, and because Eskom is not trusted owing to its past ties to illegitimate local authorities and misunderstanding of electricity and how its use is monitored and charged for. Further, it is mistaken to equate ‘development’ with total electrification: most developed countries have fuel mixes which include gas and coal, particularly for cooking and heating. Accepting an affordable fuel mix for the poor in particular would focus attention on the problems currently associated with paraffin, gas and coal, namely fires, poisoning and air pollution.     

Measuring and Reporting The Nation's Finances: Statistics and Accounting

Measuring and reporting the nation's finances are based on government budgeting, national accounting and the accounting discipline, which are all fundamentally different. The nature and extent of these differences has rarely been made explicit. The most visible change in the accounting discipline in the second half of the 20th century was the emergence of codifications of accounting, with concomitant policy–making processes that allow for 'due process'. One result is that each codification is different within countries such as the UK and US, as well as between them. The codifications for government budgeting and national accounting are different again. The article offers some broad conclusions.     

Quasi‐rational and ex ante price expectations in commodity supply models: an empirical analysis of the US broiler market

A statistically optimal inference about agents' ex ante price expectations within the US broiler market is derived using futures prices of related commodities along with a quasi‐rational forecasting regression equation. The modelling approach, which builds on a Hamilton‐type framework, includes endogenous production and allows expected cash price to be decomposed into anticipated and unanticipated components. We therefore infer the relative importance of various informational sources in expectation formation. Results show that, in addition to the quasi‐rational forecast, the true supply shock, future prices, and ex post commodity price forecast errors have, at times, been influential in broiler producers' price expectations. Copyright © 2003 John Wiley & Sons, Ltd.     

The index futures markets: Is screen trading more efficient?

This article uses a nonparametric test based on the arc‐sine law (see, e.g., Feller, 1965 ), which involves comparing the theoretical distribution implied by an intraday random walk with the empirical frequency distribution of the daily high/low times, in order to address the question of whether the abandonment of pit trading has been associated with greater market efficiency. If market inefficiencies result from flaws in the market microstructure of pit trading, they ought to have been eliminated by the introduction of screen trading. If, on the other hand, the inefficiencies are a reflection of investor psychology, they are likely to have survived, unaffected by the changeover. We focus here on four cases. Both the FTSE‐100 and CAC‐40 index futures contracts were originally traded by open outcry and have moved over to electronic trading in recent years, so that we are able to compare pricing behavior before and after the changeover. The equivalent contracts in Germany and Korea, on the other hand, have been traded electronically ever since their inception. Our results overwhelmingly reject the random‐walk hypothesis both for open‐outcry and electronic‐trading data sets, suggesting there has been no increase in efficiency as a result of the introduction of screen trading. One possible explanation consistent with our results would be that the index futures market is characterized by intraday overreaction. © 2004 Wiley Periodicals, Inc. Jrl Fut Mark 24:337–357, 2004     

Multilateral and Bilateral Loans versus Grants: Issues and Evidence

This paper examines a wide range of issues relating to the mix between loans and grants as well as the degree of concessionality of loans. A number of empirical tests are carried out based on annual panel data over 1970 to 1999 for 22 donor countries and 72 recipient countries. Based on the tests, we observe that for bilateral donors, past grant‐loan mix (and, hence, reflows from past transfers) do not influence the volume of current resource transfers. Our tests also show that the rate of official borrowing by the recipients (and, by deduction, the extent of their past debt burden) is positively influenced by the extent of the concessionality of such loans – irrespective of whether it is in the form of subsidised interest rates or longer grace periods. The paper concludes with a review of the circumstances in which grants, soft loans and non‐concessional loans might have their respective comparative advantage, as well as a discussion of the need, so as to overcome the negative incentive problems of soft loans, for a typical concessional loan package to be separated into two constituent parts. This would enable the recipient to be given the grant component and the option to take from the non‐concessional loan component as much as desired.     

SUPPLY CHAIN INFORMATION SHARING IN A VENDOR MANAGED INVENTORY PARTNERSHIP

Vendor Managed Inventory (VMI) involves the vendor making the replenishment decision for products supplied to a customer based on various inventory and supply chain policies. Information sharing between supply chain members is required in VMI. Sometimes VMI decisions are delayed and/or the information shared is inaccurate. This research examines the effects of information delay and accuracy, and the sharing of sales and forecast information in a VMI environment facing stationary and nonstationary demand. The simulation experiments show the impact of information delay, information inaccuracy, and information sharing on a variety of performance measures, including inventory levels and fill rates.     

Central bank transparency and market efficiency: An econometric analysis

Blinder (1998) argues that more open public disclosure of central bank policies may enhance the efficiency of markets. We examine this claim by studying whether the Federal Reserve System's 1994 policy shift toward more open disclosure improved or worsened the predictability of financial markets. Employing methods analogous to Campbell and Shiller (1991), we find that since 1994, the forecasting error has decreased for interest rates on U.S. bonds of most maturity lengths, and that the expectations hypothesis has performed better at the low end of the yield curve. These findings are inconsistent with the view that increased central bank transparency will decrease the efficiency of financial markets. The authors would like to thank participants of the 2001 Midwest Macroeconomics Conference and 2001 Missouri Economics Conference for their helpful comments and suggestions. All errors are, of course, the author's.     

Productivity Trends in Europe: Implications for Real Exchange Rates, Real Interest Rates, and Inflation

The paper examines a long–run (neoclassical) framework in which differences in productivity growth across sectors and countries lead to inflation differentials. In a currency union, these inflation differentials imply cross–country differentials in real interest rates. The authors estimate the likely size of these differentials for European Union countries, discuss the potential costs of persistent inflation differentials, and comment on the conflicts they may cause within Economic and Monetary Union (EMU). The analytical framework is a variant of the Balassa–Samuelson "productivity hypotheisis," which relates sectoral productivity trends to trends in the relative price of home goods.