How Monetary Policy can have Permanent Real Effects with Only Temporary Nominal Rigidity

A macroeconomic model is developed in which the psychological concept of loss aversion is incorporated into workers' preferences. The impact of monetary policy in the presence of loss aversion depends on the specification of the reference wage. The plausible specification that a worker's reference wage is the real wage she was paid in the previous period is considered in detail. Specifying the reference wage in this way, we show that an unanticipated change in monetary policy has a permanent, real effect when short term labour contracts are written in nominal wages.     

Consistent estimation of equations with composite moving average disturbance terms

The paper examines the circumstances under which an equation with a composite MA disturbance term can be consistently estimated by single-equation non-linear least squares. The composite disturbance may arise as a result of the dependent or an explanatory variable being unobservable either because it is subject to measurement error or because it is a ‘desired’ or ‘expected’ variable. It may also arise as a result of substituting out an explanatory variable from an equation or because a vector MA process is specified for the structural form of a linear simultaneous equation model. The argument of the paper relies on some results relating to the sum of finite MA processes presented in Nelson (1975a) and Darroch and McDonald (1981).     

CAPITAL RECONSTRUCTIONS: ARE THEY REALLY NECESSARY?

The topic of capital reconstructions is covered in most texts on company accounting and included in most company accounting courses of study at tertiary institutions. Unfortunately, though, there exists little material on the extent of the application of the available reconstruction options, and the usefulness of these options to companies and shareholders. This paper outlines the extent and type of the capital reconstruction schemes proposed by Australian listed companies between 1975 and 1977. Some research regarding the effectiveness of two of the options is then outlined. Finally, a call is made for research to be undertaken into the other available options to determine whether their implementation is really warranted.     

ASSET PRICING AND FINANCIAL REPORTING WITH CHANGING PRICES

This study empirically investigates the recent SFAS No. 33 requirements to determine if the inflation disclosures, or information similar to it, are impounded in security returns. An attempt is also made to determine which of the two diverse disclosures best represent the information impomded by the market. The investigation utilizes a methodological framework arising out of currently accepted asset pricing theory. The results suggest that the current cost data parallels the information impounded in security returns and that it provides risk information not included in the commonly employed systematic risk factor, beta.     

The Population Dimension in the Intergenerational Reports

The demographic assumptions and outcomes in the three successive Intergenerational Reports have differed enormously. This has brought a degree of derision upon the production of these reports in the serious press. Furthermore, the Intergenerational Reports’ projections of labour force participation rates have proven to be very wrong in the short term. The fourth Intergenerational Report will need to address this credibility gap. This article analyses the reasons that the Intergenerational Reports’ projections have been wide of the mark and makes suggestions about future approaches.     

Does the sophistication of use of unemployment insurance evolve with experience?

Abstract The subject of this paper is the repeat use of UI/EI benefits in Canada. The first objective is to investigate empirically the pattern of adjustment that UI users exhibit over a multiple claim horizon. Our secondary objective is to investigate a behavioural channel that might potentially underlie observed adjustment effects, namely, individual learning effects. We estimate an econometric model of how certain features of their claims change as they file subsequent claims. We find strong empirical patterns suggesting that there does appear to be some sort of an adjustment process; beneficiaries tend to approach a desired value for these particular facets of their UI claims. There appears to be some process of growing sophistication of UI use – which some might label ‘gaming the system’– reflecting the adjustment of claims and the concomitant employment patterns to the provisions and rules of the regime. We also uncover evidence in favour of the existence of individual learning effects.     

Ecological self-image and behaviours for children living on the streets of Harare

ABSTRACT

The present study sought to explore the relationship between street childhood and adolescent ecological self-image. The research objectives were to investigate the nature of ecological self-image for street children and to determine the ecological behaviours for street children in Harare. A psycho-ethnographic research design was employed. The participants were 16 street-living adolescent children aged between 12 and 18 years and six key informants, all in Harare, Zimbabwe. A total of 22 participants took part in this study. Snowballing was used to recruit key informant interviewees, while purposive sampling was used to recruit participants for focus group discussions, in-depth interview, and participant and non-participant observations. Thematic content analysis was used for analysing the data. Data analysis revealed that the adolescent street children's ecological self-image is largely negative. These street children seemed to have estranged from their biological families to identify with the streets.