Policy Debates on Public Finance between the Ministry of Finance and the Bank of Japan from 1930 to 1936

To appropriate additional sources of fiscal revenue, the Bank of Japan (BOJ) started direct underwriting of new deficit-financing government bond, (GBs) (BOJ underwriting) on November 25, 1932. This paper examines the BOJ's underwriting policymaking process through the use of newly available archived documents from the BOJ and the Ministry of Finance (MOF). Evidence from these documents contradicts conventional arguments that the BOJ was forced to underwrite GBs due to Finance Minister Korekiyo Takahashi's firm request and that it regarded the policy measure as temporary. Instead, the BOJ was confident it could exert monetary control through the market operation of selling underwritten GBs (selling operations). In addition, the BOJ willingly accepted the underwriting, expecting it to reinforce its influence over financial institutions. BOJ policymakers partly forecasted the course of events. First, the BOJ started underwriting during the Takahashi economic policy period (1931-36). Once it started, it was difficult for the BOJ to stop underwriting bonds. The BOJ was forced to continue underwriting deficit-financing bonds because of expanding financial demand. Second the MOF used very complex and irregular budgeting methods beginning with the budget process of fiscal 1936. This created a large deferred fiscal burden that concealed the realities of fiscal deficits.

Optimal cloning of single photon polarization by coherent feedback of beam splitter losses

Light fields can be amplified by measuring the field amplitude reflected at a beam splitter of reflectivity R and adding a coherent amplitude proportional to the measurement result to the transmitted field. By applying the quantum optical realization of this amplification scheme to single photon inputs, it is possible to clone the polarization states of photons. We show that optimal cloning of single photon polarization is possible when the gain factor of the amplification is equal to the inverse squareroot of 1-R.Comment: 10 pages, including 1 figure, extended from letter to full paper, to be published in New Journal of Physic

Scope of asymmetries in the Euro area

We discuss the scope of asymmetries in growth and inflation developments in the euro area countries, taking the euro area as the natural benchmark since the establishment of EMU. We start with a descriptive analysis of a set of indicators that can give a first idea of the likelihood of or extent to which Member States can show asymmetries with respect to the euro area. This approach typically leads to a division of countries between a core and a periphery, the former consisting over the 1993-2000 sub-period of Belgium, Germany, France, Italy, Spain and Austria and perhaps the Netherlands. However, it is rather difficult to weight the indicators and to draw a firm line between "insiders" and "outsiders" in this way. Moreover the dichotomy does not provide any information on the true extent of the asymmetries inside the core and periphery. Accordingly, we move to a quantitative approach (SVAR models) that makes it possible to assess two forms of asymmetry: asymmetry stemming from country-specific shocks and asymmetry stemming from differences in the way countries react to symmetric euro area shocks. The asymmetries are measured along two dimensions: growth and inflation developments. We find that over the years 1971-2000 growth in many countries is driven by the symmetric shocks while the opposite holds true for inflation where asymmetric (country-specific) shocks dominate. However regarding growth, the responses of the different countries to the symmetric shocks do not really differ and these shocks are not a major source of divergence. As a consequence, for growth as well as for inflation, the asymmetries with respect to the euro area are mainly the result of genuine asymmetric shocks. We notice a marked decrease in the impact of asymmetric shocks on inflation over the years, a phenomenon that is also present for growth, albeit less pronounced. If the years 1993-2000 can be used to evaluate the current situation, it appears that countries are spread along a line going from close similarity to the euro area (France) to extensive asymmetry (Ireland). Asymmetric shocks are not negligible yet with an average annual impact of around 1 percentage point on country growth or inflation. Some countries usually thought to belong to the core, are still exposed to such average shocks, in terms of growth or in terms of inflation.

Full potential unsteady computations including aeroelastic effects

A unified formulation is presented based on the full potential framework coupled with an appropriate structural model to compute steady and unsteady flows over rigid and flexible configurations across the Mach number range. The unsteady form of the full potential equation in conservation form is solved using an implicit scheme maintaining time accuracy through internal Newton iterations. A flux biasing procedure based on the unsteady sonic reference conditions is implemented to compute hyperbolic regions with moving sonic and shock surfaces. The wake behind a trailing edge is modeled using a mathematical cut across which the pressure is satisfied to be continuous by solving an appropriate vorticity convection equation. An aeroelastic model based on the generalized modal deflection approach interacts with the nonlinear aerodynamics and includes both static as well as dynamic structural analyses capability. Results are presented for rigid and flexible configurations at different Mach numbers ranging from subsonic to supersonic conditions. The dynamic response of a flexible wing below and above its flutter point is demonstrated

Transport Policies in Latin America

The issues of air pollution and traffic congestion in Latin America have been growing increasingly important since the end of the 20th century. The latter may help explain why several cities around the continent have tried different combination of public policies with vary-ing degrees of success. We describe the policies that outline the Latin American experience in this matter and hope to be a useful reference to subsequent research in the area.Transport policies, driving restrictions, public transport, air pollution, car use