Relative Price Determination in the Medium Run: The Influence of Wages,Productivity, and International Prices

This work explores three critical assumptions of the Balassa-Samuelson productivity differential model for the short and medium run: wage equalization, competitive labor markets, and purchasing power parity. The data reveal violations in these assumptions for France, Germany, Japan, the U.K., and the U.S. Significant wage and unit labor cost differentials exist across industries, and traded and nontraded sectors and these differentials do not diminish over time. The findings are consistent with the presence of industry and/or sectoral-specific human capital.     

Analysis of Participating Life Insurance Contracts: A Unification Approach

Fair pricing of embedded options in life insurance contracts is usually conducted by using risk‐neutral valuation. This pricing framework assumes a perfect hedging strategy, which insurance companies can hardly pursue in practice. In this article, we extend the risk‐neutral valuation concept with a risk measurement approach. We accomplish this by first calibrating contract parameters that lead to the same market value using risk‐neutral valuation. We then measure the resulting risk assuming that insurers do not follow perfect hedging strategies. As the relevant risk measure, we use lower partial moments, comparing shortfall probability, expected shortfall, and downside variance. We show that even when contracts have the same market value, the insurance company's risk can vary widely, a finding that allows us to identify key risk drivers for participating life insurance contracts.     

An analytic method for longitudinal mortality studies

Our knowledge of mortality risks comes largely from longitudinal (cohort) studies. The most commonly used analytic tool is the Cox proportional hazards model for survival analysis. An alternative approach is a simple cross-sectional analysis of person-years. The key to the method is logistic regression, where the outcome variable is lived/died in the given year and the explanatory variables are age, sex, and other potential risk factors. This approach can be used to model any dichotomous outcome and has several important advantages over the more traditional survival analysis. As an example, we compare the two methods using a large data base of patients with spinal cord injury.     

Comparative mortality of adults with traumatic brain injury in California, 1988--97

We studied mortality rates of people with traumatic brain injury using the extensive California Department of Developmental Services database. The data provide mortality rates by age, gender, severity, cause, and associated conditions on 2629 subjects older than 15 years during 1988--97. Increased mortality was observed, particularly among patients with diminished mobility.     

Child survival,height for age and household characteristics in Brazil

"The impact of household characteristics on child survival and height, conditional on age, is examined using household survey data from Brazil. Parental education is found to have a very strong positive effect on both outcomes and this is robust to the inclusion of household income and also parental heights, which partly proxy for unobserved family background characteristics. We find that income effects are significant and positive for child survival but insignificant for for child height although the latter depends on identification assumptions. Parental height has a large positive impact on child height and on survival rates even after controlling for all other observable characteristics."     

The Euro Area in Between Crises? Considerations on Fiscal Policies and Rules

Intereconomics - Credibility of the revised fiscal rules will be crucial so that vulnerable countries can benefit from confidence effects. National ownership will be key in that respect and can be...