Indivisible commodities and the nonemptiness of the weak core

We consider a sufficient condition for the nonemptiness of the weak core in a finite exchange economy where every commodity is available only in integer quantities. We show that if the aggregate upper contour set is discretely convex, then the weak core is nonempty. In addition, we give two sufficient conditions for the aggregate upper contour set to be discretely convex. One is that every upper contour set of every agent is M^?${\text{M}}^{?}$-convex. The other is that the number of commodities is two and every agent’s preference relation is weakly monotone and discretely convex.     

The Structure of Sunspot Equilibria: The Role of Multiplicity

This paper examines the structure of sunspot equilibria in a standard two period exchange economy with real assets. We show that for a generic choice of utility functions and endowments, there exists an open set of real asset structures whose payoffs are independent of sunspots such that the economy with this asset structure has a regular sunspot equilibrium. An important implication of our result is that the multiplicity of non-sunspot equilibria is not necessary for the existence of sunspot equilibria. Our technique is general and can be applied to show the existence of sunspot equilibria in other frameworks.     

Policy trade-off in the long run: A new Keynesian model with technological change and money growth

In this study, we introduce a constant rate of technological change and money growth into the standard new Keynesian model, in which both prices and nominal wages are supposed to be sticky. Using such a model, we examine whether a policy trade-off exists between curbing inflation and stabilizing the welfare-relevant output gap in the steady state. If we take only price stickiness into consideration, a policy trade-off does not occur. However, if both nominal wage stickiness and price stickiness are taken into consideration, a policy trade-off occurs.     

Erratum to “Do pure indivisibilities prevent core equivalence? Core equivalence theorem in an atomless economy with purely indivisible commodities only” [J. Math. Econ. 41 (4–5) (2005) 571–601]

We consider a pure exchange economy with a continuum of agents and finitely many indivisible commodities. Every commodity can be consumed only in integer amounts. Thus, agents’ preferences are locally satiated and no commodity bundle has necessarily local cheaper points. We introduce a core which is an intermediate concept between the strong core and the weak core. In our economy, this core is the most natural concept in the sense that it coincides with the set of all exactly feasible Walras allocations.     

Tests for the Poolability of Panel Data in the Presence of Unknown Heteroskedasticity: an Asymptotic Extension of ANOVA

This paper presents asymptotic tests for the poolability of panel data in the presence of heteroskedasticity. Also, the test statistic is compared with the well-known F -test statistic using simulation studies. The test statistic is regarded as an asymptotic extension of ANOVA in the sense that the statistic measures the distance between the null and the alternative models using the idea of ANOVA. Simulation studies show that the real size of the test statistic is in the neighbourhood of the nominal size, though that of the F -statistic is quite different. Even when the error term is independent and identically and normally distributed, its real size is near the nominal size and the power is not much inferior to that of the F -statistic when the sample size is large.
JEL Classification Numbers: C12, C23.     

Effects of mineral-commodity price shocks on monetary policy in developed countries

This article investigates effects of changes in mineral commodity prices on monetary policy. Using macroeconomic data from three mineral-producing countries (Australia, Canada and New Zealand) and two non-mineral-resource countries (USA and UK), I estimate the impulse response functions of the policy interest rates and the core consumer price index (CPI) inflation rates to mineral-commodity price shocks. I find that the central banks in both groups of the examined countries significantly respond to mineral-commodity price shocks. In responses to an unexpected 10% increase in mineral commodity prices, the central banks are estimated to increase their policy interest rates by approximately 0.8 percentage points. Moreover, the central banks seem to take anticipatory policy reactions to control core CPI variations triggered by these shocks. Thus, mineral commodity prices would act as important determinants of the monetary policies in both groups of the examined countries. These findings would be useful for analysing Taylor rules in their countries. However, effects of the increase in their policy interest rates on core CPI inflation cannot be identified for the examined countries.     

Representation of transferable utility games by coalition production economies

We prove that, by the method of construction of a coalition production economy due to Sun et al. [Sun, N., Trockel, W., Yang, Z., 2008. Competitive outcomes and endogenous coalition formation in an n$n$-person game. Journal of Mathematical Economics 44, 853–860], every transferable utility (TU) game can be generated by a coalition production economy. Namely, for every TU game, we can construct a coalition production economy that generates the given game. We briefly discuss the relationship between the core of a given TU game and the set of Walrasian payoff vectors for the induced coalition production economy.     

The Persistence and Forecast Accuracy of Earnings Components in the USA and Japan

Not all components of earnings are expected to provide similar information regarding future earnings. For example, basic financial statement analysis indicates that the persistence of ordinary income should be greater than the persistence of special, extraordinary, or discontinued operations. Because the market assigns higher multiples to earnings components that are more persistent, differentiating earnings components on the basis of relative persistence would appear to be useful. A focus on relative predictive value is consistent with research findings and user recommendations on separating earnings components that are persistent or permanent from those that are transitory or temporary. This paper examines the persistence and forecast accuracy of earnings components for retail and manufacturing companies listed in the world's two largest equity markets; the USA and Japan. We find the forecast accuracy of earnings in both the USA and Japan increases with greater disaggregation of earnings components. The results further indicate that the improvements in forecast accuracy due to earnings disaggregation are greater in the USA than in Japan. The greater emphasis and more detailed guidelines for reporting earnings components in the USA produce a better differentiation in the persistence of earnings components resulting in greater forecast improvements from earnings disaggregation.