Real exchange rate dynamics revisited: A case with financial market imperfections

In this paper, we investigate the relationship between real exchange rate dynamics and financial market imperfections. For this purpose, we first construct a New Open Economy Macroeconomics (NOEM) model that incorporates staggered loan contracts as a simple form of the financial market imperfections. Our model with such a financial market friction replicates persistent, volatile, and realistic hump-shaped responses of real exchange rates, which have been thought very difficult to materialize in standard NOEM models. Remarkably, these realistic responses can materialize even with both supply and demand shocks, such as cost-push, loan rate, and monetary policy shocks. This implies that the financial market development is a key element for understanding real exchange rate dynamics.     

Long-term effects of labor market conditions on family formation for Japanese youth

This study aims to examine how each cohort’s family formation is affected by labor market conditions experienced in youth in Japan. Although the deterioration in youth employment opportunities has often been blamed for Japan’s declining fertility rate, the effect of slack labor market conditions on fertility is theoretically unclear. We estimate the effects of regional labor market conditions at entry to the labor market and contemporaneous conditions on fertility, controlling for nation-wide year effects and prefecture fixed effects, and find the following. First, high school-educated women who experienced a recession while entering the labor market are less likely to have children. In contrast, a recession rather increases fertility among college-educated women. When summed up, the aggregate impact of labor market conditions experienced in youth on fertility is weak. Second, the unemployment rate at entry to the labor market is positively correlated with the probability of having two or more children conditionally on having at least one child. Third, the contemporaneous unemployment rate is negatively correlated with marriage of women in the local labor market, although the correlation is weak and concentrated on the less educated group.     

A Note on the 'Invariance of Market Innovation to the Number of Firms'*

This note disputes the claim by Sah and Stiglitz ( Rand Journal of Economics , 1987, pp.  98–108) that their strong invariance result holds in a wide range of situations.     

Fertility,human capital and the wealth of families

Summary An overlapping generations model with parental altruism is examined. The existence of the optimal value function in a model with an endogenous discount rate is proven. Two development regimes are produced: a high fertility, low income and no growth steady state, and a perpetual growth equilibrium with low fertility and rising income.This paper is adapted from my dissertation. I would like to thank the members of my dissertation committee for helpful comments and suggestions, Messrs, Gary S. Becker, Robert E. Lucas, Jr., Kevin M. Murphy and Sherwin Rosen. I'd like to thank Brooks Pierce, Paul Romer, Ken Judd, Beth Ingram, Ed Prescott and Fernando Alvarez. I also thank the workshop participants of the University of Chicago, University of Pennsylvania, University of Toronto, University of Rochester, University of Washington, Penn State University, University at Buffalo, SUNY, Columbia University and University of Iowa.     

The effect of collaboration network on inventors' job match,productivity and tenure

It has been argued in the economic literature that job search through informal job networks improves the employer–employee match quality. This paper argues that inventors' research collaboration networks reduce the uncertainty of firms about the match qualities of inventors prior to hiring. We estimate the effect of inventors' collaboration networks on their productivity and mobility using the U.S. patent application database. It is found that networked inventors are more productive and have longer tenure than non-networked inventors. The evidence from fixed-effect regressions shows that the higher productivity and longer tenure of networked inventors are not solely attributable to unobserved ability of inventors or unobserved characteristics of firms. These results are consistent with the job match hypothesis between inventors and firms through their collaboration networks.     

Defect Detection Using Unanimous Vote Among Mahalanobis Classifiers for Each Color Component

In manufacturing industries, product inspection is automated and the use of image data is increasingly being employed for defect detection. A manufacturing company in Japan produces an item and inspects the produced products using image data. Reducing the error rate is important in product inspection because poor inspection of products might lead to the delivery of defective products to consumers (consumer’s risk) and strict inspection increases production cost (producer’s risk). To reduce the error rate, we highlighted fault points using a two-dimensional moving range filter and discriminated defect production through a unanimous vote among Mahalanobis classifiers for each color component. For results, we achieved a lower error rate than the current system. This research is an empirical study of how to use image data in defect detection.     

Identifying the sources of energy use change: Multiple calibration decomposition analysis and structural decomposition analysis

Decomposition methodologies are requisite to identify the sources of changes in energy use or carbon dioxide emissions. This paper is an inquiry into the theoretical properties of such decomposition methodologies. The study first presents our new decomposition methodology – the Multiple Calibration Decomposition Analysis (MCDA) – as a tool for the investigation. Then, it theoretically reexamines an established decomposition methodology – the Structural Decomposition Analysis proposed by Casler and Rose (1998). Subsequently, the study empirically investigates the properties of both methodologies, applying them to an actual case: the changes in energy use and carbon dioxide emissions in Japan during the oil crises period, when the oil price had a significant influence on the economy. The result shows that understanding the theoretical properties of decomposition methodologies is essential for a precise interpretation of empirical results.