摘要:

Recently, some analysts have prescribed the combined use of certain market prices as a useful strategy for monetary policy. In light of problems with conventional (time‐series) empirical tests of the approach, one may consider an alternative “test” of this strategy: examining historical episodes when the strategy was employed. The Swedish experience during the early 1930s provides one such example. This experience, fathered by Knut Wicksell, is an example of a fiat money‐flexible exchange rate regime in which (i) a short‐term interest rate was used as a policy instrument, (ii) market prices were used as policy guides or intermediate indicators, and (Hi) price stability was the explicitly voiced goal of monetary policy. Monetary or reserve aggregates were neither proposed nor employed as policy guides or targets in pursuing this price stabilization objective. This Swedish experience is important since it provides a rare example of a market price approach to monetary policy. This paper demonstrates that the approach worked remark

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00326.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

The recent interstate bank merger phenomenon has received little attention in the literature. Specifically, existing studies fail to explain sufficiently the variation of premiums paid and fail to investigate adequately the bank merger wave in terms of its interstate banking context.This study employs models with substantial overall explanatory levels. The interstate banking context proves to be very significant. First, the study considers and finds significant the effective date of a state's interstate statute in relation to a deal's announcement date. This contrasts sharply with other studies. Second, the study uses and also finds significant a binary variable distinguishing intrastate deals from interstate deals. The premiums paid for interstate market entry, on average, exceeded those paid for intrastate transactions. Third, including regional binary variables reveals a pattern of variation in pricing throughout the country. The Southeast, the study's base of comparison, exhibited the highest premium level.Other significant determinants of premiums paid include profitability as measured by returns on equity, growth proxied by state deposit growth and future expected population growth, and charge‐offs to total loans as an indicator of loan qualit

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00327.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

This study asks whether the Federal Reserve has actively made monetary policy so as to aid the president's reelection. Using Shiller's smoothness “prior” to estimate the shape of cycles, the study finds a political business cycle in unemployment and a preelection increase in growth of the money supply. But the timing of these two cycles is inconsistent. Furthermore, little evidence exists of a cycle in the instruments of monetary policy. Thus, the Fed is not actively creating a political business cycle. Apparently, movements in real money that are not caused—but are not offset—by the Fed are an important cause of the political business cycle.Elections influence Fed behavior. Monetary tightness occurs early in a presidential term, before reelection incentives become critical. This is due to the Fed's political weakness. Thus, the Fed's independence only partly insulates it from electoral pr

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00328.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

One can easily identify four general models of political business cycles: office‐motivated models (both forward and backward looking) and partisan models (again, both forward and backward looking). Each model makes different assumptions about the direction and timing of causal links between the economy and polity. This paper uses Granger causality tests to investigate the causal links between presidential popularity and different measures of aggregate economic performance and aggregate economic policy. The paper's aim is to investigate whether any existing theories receive substantive support and, if not, to suggest the properties that any new theories should display. The results indicate no overwhelming support for any existing theories, though partisan models receive more support than do office‐motivated models. The data appear to be most consistent with Ellis and Thoma's reputational partisan mo

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00329.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

Projections from many macroeconometric models have suggested that the improving trend in U.S. external balance since 1987 would peter out by the end of 1990. Because the 1980s decade was a turbulent period in the international environment, one might question the reliability of these projections since the economic relationships underlying the models could have changed. This review finds insufficient evidence of structural change or of sufficiently important omitted variables to justify seriously questioning the projections. However, this study also considers model and parameter uncertainty and concludes that continued improvement in U.S. external balance is within the realm of statistical probability—but, then, so is substantial worsenin

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00330.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

This study is unique in several respects. First, it reviews the characteristics of the top 10 industries targeted for foreign direct investment (FDI) activity in the United States between 1979 and 1987. It analyzes both overall FDI activity and new plant and expansion FDI activity. The study summarizes and tests alternative hypotheses regarding the determinants of FDI in the United States by all countries, by the United Kingdom, by the European Community, by Japan, and by Canada.Large and growing product markets in an expanding economy have attracted FDI in the United States. Exchange rate movements have prompted opportunistic decisions to invest in U.S. production facilities. Investors' superior management skills appear to have prompted takeovers, while efforts to realize technological advantages of new physical capital and of relatively large operating plants have fostered plant and expansion investments.Evidence exists that a desire to circumvent current—but not potential—trade restrictions has motivated foreign direct investment. FDI activities are not associated with concentrated or heavily unionized industries. Highly protected industries have attracted heavier equity FDI by Japan and heavier new plant FDI by all sources and Canada. No evidence exists that FDI in the United States by Japan or anyone else is targeted to undercut union‐dominated firms or to arrest the spread of protectionist trade pol

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00331.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

Inflation differentials in Europe have narrowed substantially since the inception of the European Monetary System in 1979. However, their persistence after more than a decade raises the question of why these differentials are so difficult to eliminate. Some European Community countries systematically use seignorage—financing government expenditures with money creation—while others do not. This increases the difficulty of achieving the convergence of monetary policies and inflation rates required for irrevocably fixed exchange rates in Europe. This paper, utilizing a model of government finance that minimizes the social cost of financing government expenditures, examines monetary finance in the European Community. It rejects soundly the social cost minimization model of seignorage collect

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00332.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

Policymakers in the legislative and regulatory arenas face increasing public expectations that authorities will both promulgate and implement strict environmental programs. At the same time, the aggregate cost of such programs is rising and is impacting economic sectors previously untouched. In this context, a major study used an integrated interdisciplinary perspective to determine what economic benefits would result from air pollution controls. Specifically, the study developed estimates for the health benefits of reducing ozone and fine particulate matter concentrations in the nation's most polluted region—the South Coast Air Basin centering on Los Angeles. This paper presents the economic methodologies and results of that study. It also discusses how health and atmospheric sciences informed the economic assessmen

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00333.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

Leasing coastal areas so as to develop a single resource is wasteful and often leads to conflicts. Some uses impose negative externalities on other resource‐dependent uses, but such externalities should not preclude co‐development a priori. This paper describes a theoretical economic model of joint development for energy resources and mariculture showing the scientific data necessary so as to determine the optimal output for each activity in every location and to choose the optimal lease boundar

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00334.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY

摘要:

This paper borrows Dupuit's parable of a bridge so as to reexamine the problem of selecting and financing public investment projects in a dynamic and strategic setting. A regulator imposes a price ceiling, and a firm makes a sunk investment each period. Three simple examples reveal the connection between the non‐cooperative equilibrium of this relationship and the second‐best optimum. One cannot implement this “planning solution” generally since the firm and the regulator each behaves opportunistically toward the other's irreversible actions. The facility never will be built if investment in it is infinitely lumpy and if the facility is perfectly durable. Departing from this extreme case, however, one can restore proper incentives by adopting “trigger policies.” The regulator responds to a deviation from a candidate path by cutting price down to operating cost, and the firm halts all investment. If capital does not depreciate too slowly and the future is not discounted too much, then one can approximate the planning solution by an equilibrium. The success of trigger policies suggests that reformers should relax many regulatory rules and procedures to support efficient investment in inf

ISSN:1074-3529    

DOI:10.1111/j.1465-7287.1991.tb00335.x

出版商:Blackwell Publishing Ltd    

年代:1991

数据来源: WILEY