Terms of Trade Disturbances, Real Exchange Rates and Welfare: The Role of Capital Controls and Labor Market Distortions

Many arguments that have been advanced in favor of maintaining capital control within the EEC have not paid sufficient attention to the welfare consequences of this type of market intervention. Our paper provides a simple, optimizing framework in which the welfare consequences of capital controls can be assessed. Two main issues are considered. First, how do capital controls affect the adjustment of macroeconomic variables to real disturbances? Second, what is the nature of second best arguments for maintaining capital controls given that certain distortions will remain after the European single market is in place in 1992?

International Evidence on Fiscal Solvency: Is Fiscal Policy "Responsible"?

This paper looks at fiscal solvency and public debt sustainability in both emerging market and advanced countries. Evidence of fiscal solvency, in the form of a robust positive conditional relationship between public debt and the primary fiscal balance, is established in both groups of countries, as well as in the sample as a whole. Evidence of fiscal solvency is much weaker, however, at high debt levels. The debt-primary balance relationship weakens considerably in emerging economies as debt rises above 50 percent of GDP. Moreover, the relationship vanishes in high-debt countries when the countries are split into high- and low-debt groups relative to sample means and medians, and this holds for industrial countries, emerging economies, and in the combined sample. These findings suggest that many industrial and emerging economies, including several where fiscal solvency has been the subject of recent debates, appear to conduct fiscal policy responsibly. Yet our results cannot reject the hypothesis of fiscal insolvency in groups of countries with high debt ratios, where the response of the primary balance to increases in debt is not statistically significant.

Primary Surplus Behavior and Risks to Fiscal Sustainability in Emerging Market Countries: A "Fan-Chart" Approach

This paper proposes a probabilistic approach to public debt sustainability analy-sis (DSA) using "fan charts." These depict the magnitude of risks-upside and downside-surrounding public debt projections as a result of uncertain economic conditions and policies. We propose a simulation algorithm for the path of public debt under realistic shock configurations, combining pure economic disturbances (to growth, interest rates, and exchange rates), the endogenous policy response to these, and the possible shocks arising from fiscal policy itself. The paper empha-sizes the role of fiscal behavior, as well as the structure of disturbances facing the economy and due to fiscal policy, in shaping the risk profile of public debt. Fan charts for debt are derived from the "marriage" between the pattern of shocks on the one hand and the endogenous response of fiscal policy on the other. Applications to Argentina, Brazil, Mexico, South Africa, and Turkey are used to illustrate the approach and its limitations. Copyright 2006, International Monetary Fund

The Prospects for Sustained Growth in Africa: Benchmarking the Constraints

A dozen countries had weak institutions in 1960 and yet sustained high rates of growth subsequently. We use data on their characteristics early in the growth process to create benchmarks with which to evaluate potential constraints on sustained growth for sub-Saharan Africa. This analysis suggests that what are usually regarded as first-order problems -- broad institutions, macroeconomic stability, trade openness, education, and inequality -- may not nowbe binding constraints in Africa, although the extent of ill-health, internal conflict, and societal fractionalization do stand out as problems in contemporary Africa. A key question is to what extent Africa can rely on manufactured exports as a mode of "escape from underdevelopment," a strategy successfully deployed by almost all the benchmark countries. The benchmarking comparison specifically raises two key concerns as far as a development strategy based on expanding exports of manufactures is concerned: micro-level institutions that affect the costs of exporting, and the level of the real exchange rate -- especially the need to avoid overvaluation.

Entradas de capital: el papel de los controles

Este escrito analiza el manejo de las entradas de capital en los mercados emergentes. Revisa las principales herramientas de política, incluidas la política fiscal y monetaria, la política cambiaria, la intervención en el mercado de cambios, la regulación prudencial doméstica y los controles al capital. Una conclusión clave es que si la economía funciona cerca del potencial, el nivel de reservas es adecuado, la tasa de cambio no está subvaluada y es probable que las entradas sean transitorias, el uso de controles al capital –además de la política prudencial y macroeconómica– se justifica como parte del conjunto de herramientas de política para manejar las entradas. La evidencia de la crisis actual sugiere que los controles encaminados a lograr una estructura de obligaciones externas menos riesgosa redujeron la fragilidad financiera y aumentaron la resiliencia ante caídas del crecimiento

Entradas de capital: el papel de los controles

This paper analyzes the management of surges in capital inflows to Emerging Markets. It reviews the main policy tools, including fiscal and monetary policy, exchange rate policy, foreign exchange market intervention, domestic prudential regulation, and capital controls. A key conclusion is that, if the economy is operating near potential, if the level of reserves is adequate, if the exchange rate is not undervalued, and if the flows are likely to be transitory, then use of capital controls –in addition to both prudential and macroeconomic policy– is justified as part of the policy toolkit to manage inflows. Evidence from the current crisis suggests that controls aimed at achieving a less risky external liability structure reduced financial fragilities and increased growth resilience.capital inflows, capital controls, financial crisis

The impact of weather on COVID-19 pandemic

Rising temperature levels during spring and summer are often argued to enable lifting of strict containment measures even in the absence of herd immunity. Despite broad scholarly interest in the relationship between weather and coronavirus spread, previous studies come to very mixed results. To contribute to this puzzle, the paper examines the impact of weather on the COVID-19 pandemic using a unique granular dataset of over 1.2 million daily observations covering over 3700 counties in nine countries for all seasons of 2020. Our results show that temperature and wind speed have a robust negative effect on virus spread after controlling for a range of potential confounding factors. These effects, however, are substantially larger during mealtimes, as well as in periods of high mobility and low containment, suggesting an important role for social behaviour

Defendant\u27s Motion for Summary Judgment

The State argues that even viewing all evidence in the light most favorable to the Estate of Sam Sheppard, the Estate cannot demonstrate that: (1) the court has subject matter jurisdiction, and (2) the Estate has standing. The State argues in the alternative that this lawsuit is not time-barred by the statute of limitations and laches. In addition, the Estate has provided no significant probative evidence in support of its claim; it is instead repackaging evidence that has been available for decades and spinning the meaning of scientific data to fit its interest. This argument does not rise to a level sufficient to overcome a motion for summary judgment. Therefore, the State is entitled to judgment as a matter of law since no genuine issue of material fact exists. The State\u27s Motion for Summary Judgment was denied on 01/24/00; see docke

Attentive Learning of Sequential Handwriting Movements: A Neural Network Model

Defense Advanced research Projects Agency and the Office of Naval Research (N00014-95-1-0409, N00014-92-J-1309); National Science Foundation (IRI-97-20333); National Institutes of Health (I-R29-DC02952-01)