Showing 1 - 10 of 120
Linear RE models typically possess a multiplicity of solutions. Consider, however, the requirement that the solution coefficients must not be infinitely discontinuous in the model's structural parameters. In particular, we require that the solutions should be continuous in the limit as those...
Persistent link: https://www.econbiz.de/10010950645
In a model of evolution driven by conflict between societies more powerful states have an advantage. When the influence of outsiders is small we show that this results in a tendency to hegemony. In a simple example in which institutions differ in their "exclusiveness" we find that these...
Persistent link: https://www.econbiz.de/10010950707
A sleepy consensus has emerged that U.S. GNP data are uninformative as to whether trend is better described as deterministic or stochastic. Although the distinction is not critical in some contexts, it is important for point forecasting, because the two models imply very different long-run...
Persistent link: https://www.econbiz.de/10005710297
Several school districts use assignment systems in which students have a strategic incentive to misrepresent their preferences. Indeed, we find evidence suggesting that reported preferences in Cambridge, MA respond to these incentives. Such strategizing can complicate the analysis of...
Persistent link: https://www.econbiz.de/10011103518
Many believe that "big data" will transform business, government and other aspects of the economy. In this article we discuss how new data may impact economic policy and economic research. Large-scale administrative datasets and proprietary private sector data can greatly improve the way we...
Persistent link: https://www.econbiz.de/10010969342
Changes in nominal interest rates must be due to either movements in real interest rates, expected inflation, or the inflation risk premium. We develop a term structure model with regime switches, time-varying prices of risk, and inflation to identify these components of the nominal yield curve....
Persistent link: https://www.econbiz.de/10005088590
This paper develops a structural VAR model to measure how a shock to one country can affect the GDP of other countries. It uses trade linkages to estimate the multiplier effects of a shock as it is transmitted through other countries' output fluctuations. The paper introduces a new specification...
Persistent link: https://www.econbiz.de/10005580736
This paper develops a decision-theoretic approach to policy analysis. We argue that policy evaluation should be conducted on the basis of two factors: the policymaker's preferences, and the conditional distribution of the outcomes of interest given a policy and available information. From this...
Persistent link: https://www.econbiz.de/10005778095
This paper extends the class of stochastic volatility diffusions for asset returns to encompass Poisson jumps of time-varying intensity. We find that any reasonably descriptive continuous-time model for equity-index returns must allow for discrete jumps as well as stochastic volatility with a...
Persistent link: https://www.econbiz.de/10005829900
This study examines the tax reporting consequences of financial reporting discretion. Using a matched sample of financial statements with tax returns, I provide estimates of the accuracy of tax return information inferred from financial statements. To examine the tradeoffs between financial and...
Persistent link: https://www.econbiz.de/10005710636