The Reaction of Coffee Futures Price Volatility to Crop Reports

Analysis of prices and volatility plays an important role in coffee market, especially for developing countries, whose small producers and economies rely heavily on income generated by coffee trade. This study explores the impact of coffee crop reports on price volatility for coffee futures contracts during 2004–2014. Overall, results indicate that crop reports generally affect price volatility. The impact is particularly stronger when they provide information following the flowering periods in Colombia, Brazil, and Vietnam, world’s major producers.     

The impact of foreign stock markets on macroeconomic dynamics in open economies: A structural estimation

With the increased international financial integration in recent years, bilateral financial linkages between countries may have a growing influence on their real economies. This paper employs a structural two-country New Keynesian model, which incorporates a cross-border wealth channel, to estimate the effect that foreign stock market fluctuations may have on macroeconomic variables in open economy countries.The model is estimated using Bayesian methods on a sample of open economies that can potentially be affected by changes in a larger foreign stock market: Australia, Canada, New Zealand, Ireland, Austria, and the Netherlands. The estimation allows for deviations from rational expectations and for learning by economic agents.The empirical results indicate important cross-country wealth effects for Ireland and Austria, from fluctuations in the U.S. and U.K. and in the U.S. and German stock markets, respectively; the wealth effect is largest in Ireland. The data favor, instead, specifications with no significant wealth effect for the remaining countries. Foreign stock price fluctuations, however, still play a role by affecting domestic expectations about future output gaps in all countries in the sample.     

The Small Open-Economy New Keynesian Phillips Curve: Empirical Evidence and Implied Inflation Dynamics

In this paper we apply GMM estimation to assess the relevance of domestic versus external determinants of CPI inflation dynamics in a sample of OECD countries typically classified as open economies. The analysis is based on a variant of the small open-economy New Keynesian Phillips Curve derived in Galí and Monacelli (Rev Econ Stud 72:707–734, 2005), where the novel feature is that expectations about fluctuations in the terms of trade enter explicitly. For most countries in our sample the expected relative change in the terms of trade emerges as the more relevant inflation driver than the contemporaneous domestic output gap.     

INPUT AND OUTPUT INVENTORIES IN GENERAL EQUILIBRIUM*

We build and estimate a two‐sector dynamic stochastic general equilibrium model with two types of inventories: Input inventories facilitate the production of finished goods, output inventories yield utility services. The estimated model replicates the volatility and cyclicality of inventory investment and inventory‐to‐target ratios. Although inventories are an important element of the model’s propagation mechanism, shocks to inventory efficiency are not an important source of business cycles. When the model is estimated over two subperiods (pre‐ and post‐1984), changes in the volatility of inventory shocks or in structural parameters associated with inventories play a small role in reducing the volatility of output.     

LABOR MARKET INSTITUTIONS AND MACROECONOMIC VOLATILITY IN A PANEL OF OECD COUNTRIES

In this paper we analyze empirically how labor market institutions influence business cycle volatility in a sample of 20 OECD countries. Our results suggest that countries characterized by high union density tend to experience more volatile movements in output, whereas the degree of coordination of the wage bargaining system and the strictness of employment protection legislation appear to be only of limited importance. We also find some evidence suggesting that highly coordinated wage bargaining systems have a dampening impact on inflation volatility.     

The Big Bang: Tax Evasion After Automatic Exchange of Information Under FATCA and CRS

ABSTRACT

After decades of ineffective attempts to fight tax evasion, the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS) recently implemented the first encompassing international exchange of tax-related information on an automatic basis. This is an important development because tax evasion contributes to rising socio-political inequality and political sovereignty losses. This article assesses the treaties’ impact on tax evasion by conducting a difference-in-difference analysis of cross-border asset data. The results show that the treaties are successful. Household assets in tax havens that are not hidden behind corporate identities are estimated to be 67 per cent lower than they would have been without automatic exchange of information. Furthermore, this reduction is not offset by an increase in treaty circumvention using identity concealment or asset shifting to non-compliant jurisdictions. FATCA and CRS thus implement the first effective international cooperation against tax evasion. The results imply that political globalisation is capable to mitigate the political sovereignty losses and rise of inequality caused by economic globalisation.     

Estimates of the Open Economy New Keynesian Phillips Curve for Euro Area Countries

This paper extends the existing literature on the open economy New Keynesian Phillips Curve by incorporating three different factors of production, domestic labor and imported as well as domestically produced intermediate goods, into a general model which nests existing closed economy and open economy models. The model is estimated for nine euro area countries and the euro area aggregate. We find that the general specification of our model improves the fit of the New Keynesian Phillips Curve considerably compared to the closed economy specification. The estimates of the structural parameters of the model suggest strong heterogeneity in the degree of price rigidity across euro area counties. Furthermore, we find the degree of price rigidity to be systematically lower in the open economy specification than in the closed economy specification and also lower than in the general specification of our model.

The changing boundaries of system companies

While project marketing and systems selling are mainly concerned with market relations of companies organized on a project basis, it is important to conceptualize the interactions between market conditions and long term technology problems of these firms.The paper deals with strategic problems of system companies. By system companies the authors mean those large, multi-technology, multi-business firms that are typically active in systemic industries in most industrialized countries. In these industries market demand has some peculiar features: discontinuity, heterogeneity and customization, long and complex buying process, variable specification capability of customers. On the supply side, system companies produce unique or small series products, on a customized basis, by using a large array of technologies.System integration is the distinctive strategic capability of these companies. It is argued that system integration involves the management of a peculiar kind of uncertainty. The long run strategic objective of system companies is to maintain the global control of the technological dynamics of the system. However, there are many possible changes in the boundaries of product systems that may threat the viability of control. To gain strategic control, system companies have to manipulate simultaneously market and technology leverages. The paper offers a rich conceptual discussion of these problems.     

Technological Regimes and the Growth of Networks: An Empirical Analysis

This paper shows how specific technological and relational regimes have shaped the growth of the network of R&D collaborative agreements in pharmaceuticals in the 1990s. Our analysis reveals the existence of a complex set of regimes of firm growth within the network, providing additional evidence supporting prediction that both growth and innovative activities of large and small firms respond, even within a given industry, to considerably different technological and economic factors. Moreover, the paper shows, in the context of a specific industry and by means of a series of preliminary and explorative empirical analyses, that information on the topological properties of a given industrial settings and on roles/positions of organizations within it can be used to disentangle some fundamental generative processes underlying observed processes of growth. This result contributes to the "old" stochastic approach to firm growth, in the direction of building parsimonious and, at the same time, more realistic, representations of processes of industrial growth.