Search results for "Short run"
showing 10 items of 21 documents
Key Economic Characteristics of Italian Trawl Fisheries and Management Challenges
2017
Two key measures of economic performance are calculated and analyzed for three important Italian trawl fisheries (Northern Thyrrenian Sea, South of Sicily, Northern Adriatic Sea): the Net Economic Returns (NER), which informs on the economic performance and is considered a proxy of resource rent in fisheries and the Return on Fixed Tangible Assets (ROFTA), which is used as an approximation of the Return on Investment (ROI) and is a key financial and performance indicator for a fisherman in order to take a decision to operate in a fishery. The trend of these indicators over the last decade highlights a poor economic performance that is associated with an overall poor condition of the state o…
Institutions and Innovation as Driving Forces Towards a Smart City and Sustainable Territorial Development
2018
The aim of the chapter is the analysis of innovation and institution as key-elements for reaching a higher social welfare and for improving environmental quality. To determine a social optimum or a Pareto improvement, we consider the interaction between institution and firm in the short and in the medium/long run. Using a static comparative analysis, the interaction of these two agents, institution and market, is examined. Within the market an entrant and an incumbent firm are present, and the entrant firm radically innovates. Even if in the short run results show that the market alone is able to realize a Pareto improvement, an institution action through an innovation adoption is a prefera…
Discretionary Government Consumption, Private Domestic Demand, and Crisis Episodes
2012
This paper analyzes the dynamic impact of discretionary government consumption purchases on private demand. Using a panel of 132 countries from 1960 to 2008, we find that while discretionary changes in government consumption lead to crowding-in effects in the short run, crowding-out effects take over in the medium run. In addition, we also find that both short-term crowding-in and mediumterm crowding out effects are amplified once we control for periods of crisis.
A rational expectations model for simulation and policy evaluation of the Spanish economy
2010
This paper presents the model used for simulation purposes within the Spanish Ministry of Economic Affairs and Finance. REMS (a Rational Expectations Model for the Spanish economy) is a small open economy dynamic general equilibrium model in the vein of the New-Neoclassical-Keynesian synthesis models, with a strongly micro-founded system of equations. In the long run REMS behaves in accordance with the neoclassical growth model. In the short run, it incorporates nominal, real and financial frictions. Real frictions include adjustment costs in consumption (via habits in consumption and rule-of-thumb households) and investment into physical capital. Due to financial frictions, there is no per…
Potential Emigration of Latvian Labour Force After Joining the EU and its Impact on Latvian Labour Market
2003
This paper uses empirical evidence from several sources to shed light on patterns of mobility of Latvian labour force during the transition period as well as in the years to come. Updated inter-regional migration rates show that Latvian population is relatively mobile compared to some other European nations. Other things equal, during the transition period people were more likely to leave districts with low wage levels and to enter the ones where earnings are higher, despite many countervailing factors; outflow rates tended to be larger from high unemployment regions. Analysis of individual migration decisions made in 1989-1999 and migration plans for 1999-2002 confirms significance of econ…
Stock earnings and bond yields in the US 1871–2017 : The story of a changing relationship
2021
Abstract Using historical data spanning almost 150 years, we examine whether there is a long-run equilibrium relationship between the stock's earnings and bond yields. The novelty of our econometric methodology consists in using a vector error correction model where we allow multiple structural breaks in the equilibrium relationship. The results of our analysis suggest the existence of an equilibrium relationship over 1871–1932 and 1958–2017. On the two historical segments, our analysis finds that the stock's earnings yield followed the bond yield in both the short run and long run, but not the other way around. Perhaps the most important and surprising finding of our empirical study is tha…
Short-Run Dynamics of the Trade Balance in the EMU-12 Countries
2016
During the pre-EMU period real effective exchange rate or domestic and foreign GDP per capita growth rate differential Granger-caused aggregate trade balance in most of the EMU-12 countries. However, our data-driven paper provides evidence that during the EMU period neither the growth differentials nor the CPI-based real effective exchange rates have Granger-caused the aggregate trade balances. When we decompose the aggregate trade balances into the intra balances (trade balance vis-a-vis the euro area) and the extra balances (trade balance vis-a-vis the rest of the world), we find that typically the change in the dynamics of the aggregate trade balance resulted from a change in the dynamic…
Substituting a substitute currency
2008
Abstract This study evaluates the dynamics between the dollar and euro balances in the Estonian economy. The focus is to apply the traditional currency substitution model to the substitution of the substitute currency, the dollar and euro-related foreign currency balances. We find substitution between the dollar and the euro to be asymmetric in the short run. Inertia, irreversibility and ratchet effects favoured the use of the euro as a substitute currency. No significant evidence of asymmetries in the long run was detected. However, in general, a traditional model for currency substitution was capable of explaining the dynamics of the euro and the dollar as substitute foreign currencies.
Regulation of Investments in Infrastructure: The Interplay between Strategic Behaviors and Initial Endowments
2012
This paper explores the dynamic properties of price-based policies in a model of competition between two jurisdictions. Jurisdictions invest over time in infrastructure to increase the quality of the environment, a global public good. They are identical in all respects but one: initial stocks of infrastructure. This is a dynamic type of heterogeneity that disappears in the long run. Therefore, at the steady state, usual intuitions from static settings apply: identical jurisdictions inefficiently underinvest, calling for public subsidies. In the short run, however, counterintuitive properties are established: (i) the evolution of capital stocks can be nonmonotonic and (ii) one jurisdiction c…
Instability tests in cointegration relationships. An application to the term structure of interest rates
2002
Abstract This paper tries to review, from a practitioner's point of view, the recent strand of literature on cointegration tests allowing for structural changes or parameter instability. Thus, we apply several tests using as an example the expectations model of the term structure of interest rates. The results are consistent with the existence of cointegration between the long and the short run Spanish interest rates, with a vector (1,−1), as predicted by the theory. However, there is also evidence of structural instability, mainly at the beginning of 1994, that can be attributed to the financial changes that occurred in Spain as a result of its external commitments in the process of the Eu…