competing models of international lending activity abstract four competing models of the world bank s lending to developing countries are constructed and econometrically estimated by pooled time series and cross section data the analysis suggests that a model combining economic and political determinants performs best besides per capita income inflation balance of payment and budget deficit external debt and past growth political determinants such as the capitalist climate or political instability are also important as well as a recipient country s former status as a colony or dominion this politico economic model is successfully used to forecast the distribution of ibrd loans and ida credits among the developing countries

the shape of public choice to come some predictions and advice in the normal course of events elders are sometimes called upon to reflect on the past while the more youthful set about deciding the future for the most part i shall honor the dictum but offer some unsolicited advice on what needs to be done and be so bold as to predict these suggestions will be acted upon a kind of self fulfilling prophecy of course the advice may be rejected or ignored what then

returns and option activity over the option expiration week for s p 100 stocks abstract for s p 100 stocks we find that the weekly returns over option expiration oe weeks a month s third friday week tend to be high relative to 1 the third friday weekly returns of other stocks with less option activity 2 the own stock s other weekly returns 3 the risk based on asset pricing alphas for these same stocks a month s fourth friday weekly returns underperform modestly we suggest the following two avenues are likely partial contributors towards understanding these return patterns 1 delta hedge rebalancing by option market makers with a reduction in short stock hedge positions over the oe week and 2 declining risk perceptions over the oe week as measured by option derived implied volatilities our findings suggest option activity can induce reliable patterns in the weekly returns of option active large cap stocks

black hole tariffs and endogenous policy theory political economy in general equilibrium preface acknowledgments list of results 1 a preview of the results 2 endogenous policy theory a diagrammatic approach part i endogenous policy theory with specific factors the theory of industry tariffs in partial equilibrium 3 the probabilistic voting model of political efficiency and powerless politicians 4 endogenous lobbying theory and the contribution specialization theorem 5 endogenous tariff theory 6 the power function model of endogenous industry lobbying 7 three simple tests of the stolper samuelson theorem 8 the invisible foot and the waste of nations lawyers as negative externalities part ii endogenous policy theory in general equilibrium a long run theory of national tariff levels 9 the 2 x 2 x 2 x 2 model of endogenous redistribution theory 10 a prisoner s dilemma theory of endogenous protection the leontief model 11 the compensation effect and the multiple equilibrium trap 12 increasing returns to politics and factor endowments economic development and brazilian vitality versus the indian disease 13 endogenous protection in the united states 1900 88 14 a cobb douglas model 15 black hole tariffs 16 the endowment effect cross national evidence on endogenous tariffs part ii postscript 17 the senile industry argument for protection 18 optimal obfuscation and the theory of the second worst the politically efficient policy mathematical appendices references author index subject index

sources procedures and microeconomic effects of innovation fabio arcangeli paul david frank engelman christopher freeman massimo moggi richard nelson luigi orsenigo nathan rosenberg michele salvati g n von tunzelman two anonymous referees and the participants at the meeting of the committee on distribution growth and technical progress of the italian national research council cnr rome november 16 1985 have helped with various redraftings a particularly grateful acknowledgment is for the insightful and patient help of moses abramovitz this work has been undertaken at the science policy research unit spru university of sussex as part of the research program of the designated research centre sponsored by the economic and social research council esrc earlier support to the research that led to this paper by the italian national research council cnr is also gratefully acknowledged the statistical research has been undertaken with the assistance of stephano brioschi ilaria fornari and giovannu prennushi

endogenous technological change and emissions the case of the german steel industry abstract the paper starts from the observation that innovation and technical progress are only portrayed superficially in the predominant environmental economic top down models and that the assumption of perfect factor substitution does not correctly mirror actual production conditions in many energy intensive production sectors bottom up models on the other hand neglect macroeconomic interdependencies between the modelled sector and the general economy this paper presents a new modelling approach in an integrated bottom up top down approach based on the example of crude steel production in germany it is demonstrated how technological progress can be portrayed as process related and policy induced and how the technology choice between limitational processes can be explicitly modelled and implemented in the econometric input output model panta rhei the new modelling approach presented permits a process specific analysis of the impacts of changed frame conditions the effects of which on the choice of technology on the one hand and the technological progress on the other can be described endogenous to the model these features are demonstrated in a co2 tax simulation results show that policy induced technological change is besides a switch in production processes the major source of co2 reduction for the steel sector

military expenditures and bureaucratic competition for rents this paper has provided empirical evidence on the relationship between transfers to the military and the degree of political competition in a country it has been argued that in both democratic and autocratic rent seeking societies the military may have a significant advantage in capturing government transfers in democratic societies the role of the military as guardian of national security puts it in a unique position to seek transfers as a result military elites in these countries have been quite successful in influencing the political system to increase rents to them and members of their group in dictatorships violence is an important rent seeking behavior since the military has a comparative advantage in violence it has emerged as the dominant rent seeking interest group in these countries as a result military groups dominate resource allocations in most politically unstable countries

environmental and economic effects of post kyoto carbon regimes results of simulations with the global model ginfors abstract using the extensive and disaggregated global ginfors model consequences of different possible post kyoto regimes on the german and european economy and other major economies in the medium run until 2020 are depicted the approach is very extensive and detailed in comparison to already existing analyses this holds for the number of explicitly modelled countries 50 and 2 regions and 41 economic sectors input output tables the bilateral trade flows the detailed coverage of behavioural parameters the coverage of energy balances and co 2 emissions as well as for the number and precise economic political design of simulation runs global emissions will double until 2030 compared to 1990 levels without the existence of a far reaching climate regime after 2012 a unilateral commitment of the eu would only be a drop in the bucket which solely strengthens the credibility of the eu in international negotiations a stabilisation of global emissions in 2020 compared to 2010 which is consistent with the 2 target of the eu can only be achieved if all developed and at least the large emerging economies participate and if all possible existing market ready reduction technologies are used

government introduced price distortions and growth evidence from twenty nine developing countries from the time adam smith s wealth of nations was published in 1776 until today the role of the state in the economic affairs of nations has been probably one of the most debated subject matters not only among economists but also among other social scientists a free competitive market and pricing system has since been recognized as a crucial factor in the allocation of resources indeed in the economic development of nations at the national as well as international levels there is a growing interest in the role of governmental policies in particular those policies that directly or indirectly influence the working of the market mechanism and the incentive system in the context of nations economic growth an example of the growing interest is the rather unequivocal focus placed in recent years by the world bank and the international monetary fund imf on the need for liberal competitive and outward looking policies in promoting economic growth in developing countries an area of particular concern has been that of the government introduced price distortions in several developing nations historically speaking such policies have grown over time as a part of the so called grand socialistic and planned economic policies and programs undertaken by several developing nations since they attained political independence these nations embarked upon such policies in pursuance of the promises that were made by their political leaders during their freedom movements against the colonial powers the imposition of controls by governments over domestic prices interest rates wages foreign trade and exchange rates for example has caused severe distortions in the economies of these nations and such distortions are not without bearing on economic growth according to the world bank 1983 2 coun

rent seeking and institutional stability in developing countries although developing countries are most often associated with institutional instability most are fairly stable and may be considered extremely stable if one takes into account the fact that policies adopted by many of these nations are highly inefficient in a large number of cases post independence economic policies adopted by developing countries have resulted in very slow stagnant or even negative economic growth in more advanced and democratic countries such policies would prevent the reelection of leaders although a small fraction of the population enjoys an extremely high standard of living the majority of the population in developing countries have not experienced any significant gains in their standard of living since independence yet while there have been several coups and attempted coups many governments have remained relatively stable with some leaders remaining in power for over a quarter of a century in other cases leaders have served until their death and successors have continued uninterrupted with remarkable stability even when such leaders adopt what may be considered extremely inefficient policies why then have many institutions remained so stable the present paper argues that the stability observed in many developing countries is a result of a rent seeking equilibrium between well organized interest groups in the population that compete for wealth transfers generated by the relatively weaker and more poorly organized groups in this equilibrium the military is one of the most important interest groups that benefit from the transfers because rent seeking in these countries often involves violence the

emergence of new economics energy transition models a review abstract well known academic and non academic institutions call for a new approach in economics able to capture features of modern economies including but not limited to complexity non equilibrium and uncertainty in this paper we provide a systematic review of ecological macroeconomic models that are suitable for the investigation of low carbon energy transitions and assess them based on the features considered desirable for a new approach in economics we draw two main conclusions firstly the knowledge base and structure of these existing ecological macroeconomic models are relevant alongside other types of models for the creation of a new approach in economics secondly the reviewed models are policy relevant especially in the context of the complexity and urgency of rapid energy transitions where increasingly policymakers require economic models able to capture real world characteristics however further improvements are needed to these models and future research should focus on i assuring comparability of models results and their policy insights ii incorporation of the relationships between macroeconomics finance and sustainability and iii the institutionalization of a new approach in economics

manipulation in the vix at the settlement time of the vix volatility index volume spikes on sp editorial decision june 19 2017 by editor robin greenwood

a model based assessment of the impact of revitalised r d investments on the european power sector abstract this paper presents an analysis of the effect of enhanced research and development r d efforts for a set of low carbon power technologies on the development of the european energy sector it applies a methodology using the concept of two factor learning which quantitatively links trends in technology cost to both accumulated r d investments and production volumes the impacts of the latter on the energy sector are then simulated in a consistent manner with the poles global energy model on this basis it compares the total system costs of an assumed increase in worldwide r d investments that for the eu are in line with proposals made in its european strategic energy technology plan to a baseline development it finds that an increase in research efforts at a global level will contribute to reducing the costs of currently less mature low carbon technologies thus accelerating their market entry when comparing two scenarios that both fulfil the eu s 2020 energy and climate objectives and differing only in their r d investment levels the reduced technology costs allow eu support policies for renewables and carbon values to be reduced and the cumulative discounted benefit of the accelerated research efforts is positive in the long term

technological learning in energy environment economy modelling a survey abstract this paper aims at providing an overview and a critical analysis of the technological learning concept and its incorporation in energy environment economy models a special emphasis is put on surveying and discussing through the so called learning curve both studies estimating learning rates in the energy field and studies incorporating endogenous technological learning in bottom up and top down models the survey of learning rate estimations gives special attention to interpreting and explaining the sources of variability of estimated rates which is shown to be mainly inherent in r d expenditures the problem of omitted variable bias the endogeneity relationship and the role of spillovers large scale models survey show that despite some methodological and computational complexity related to the non linearity and the non convexity associated with the learning curve incorporation results of the numerous modelling experiments give several new insights with regard to the analysis of the prospects of specific technological options and their cost decrease potential bottom up models and with regard to the analysis of strategic considerations especially inherent in the innovation and energy diffusion process in particular the energy sector s endogenous responses to environment policy instruments top down models

the politico economic behavior of authoritarian governments the study of the interaction between the economic and political behavior of governments in democratic western capitalist countries has yielded many insights in the three decades since anthony downs an economic theory of democracy was published in 1957 similarly the study of the overt political component of the economic decision making process in authoritarian eastern centrally planned economies has attained a great degree of refinement in the post stalin era for most countries in the world however neither model democratic curn capitalist nor authoritarian curn centrally planned applies very well rather there is a third type more or less authoritarian curn more or less capitalist which reasonably describes a large number of developing countries it is likely that the behavior of these countries governments will not be well explained by models which fit the other two types the purpose of this paper is to propose a framework in which the economic decisions of authoritarian governments can be analyzed without assuming that the government is the only economic agent thus in basically capitalist countries where elections are not the means by which power is validated and transferred 1 the political economic behavior of government an individual s first formal exposure to economics is usually a principles text in early chapters of most of them the economic system is described as being determined by the interaction among three groups of economic agents households firms and governments the latter which only began to be considered an economic agent of important status with the advent of keynesian analysis is in such texts initially accorded a place of equality with the other two but soon is presumed to behave entirely differently while households and firms exhibit maximizing behavior in their own self interest the government s economic actions are motivated by a desire to stabilize and

democracy dictatorship and decision costs this paper tries to help bridge the inductive and the deductive traditions in the study of democracy i identify two empirical patterns which i call the paradox of conflict and the paradox of decision importance more conflict ridden societies are both less likely to be democracies and when democratic more likely to be consensual rather than majoritarian similarly important revolutionary regime transforming decisions are less likely to be democratic but when democratic they are more likely to be consensual i use a decision cost minimizing model of democracy to explain those patterns the model is developed out of the metaphor of institutions as decision producing firms attempting to maximize quality and minimize cost of those decisions its main intellectual source is the transaction cost minimizing view of organizations but the formalism owes most to buchanan and tullock s calculus of consent

political instability in africa a rent seeking approach the foregoing analysis developed the paradigm of self interest motivated revolutionary activities in effect the construct presented differs from the by product theory developed by tullock only in its specific modeling of government created rents as the engine which drives the violent political behavior the empirical test of the positive relationship between rent creation by the government and the amount of destabilizing political activity yields strong support for the structuring of politically destabilizing activities as rent seeking in nature it is the authors hope that further empirical investigation and a more general and rigorous modeling of revolution as a rent seeking activity will become an important part of the literature in public choice

on the inefficient extraction of rents by dictators most countries in the world are governed by autocracy that is some form of one man rule be it monarchy or dictatorship dictatorship is a prevalent form of autocracy with a majority of the world s population living under this type of rule yet when analyzed from an economic point of view dictatorships do not appear to be efficient they are not efficient in social terms and more strangely they do not appear to be efficient from the dictator s viewpoint take one example in bulandia a fictitious country a general from the army overthrows the government and establishes himself as the supreme leader he promptly places those who helped him in the revolution in key government positions as well as granting them favors in the business world such positions and favors are considered rewards for supporting the revolution they can be considered a cost of the revolution suppose the general appoints his brother an air force colonel as head of the newly established national mining industry his brother having no background in business or engineering is to say the least not the most qualified man for the job but it is assumed that he must be granted the position in order to maintain a stable coalition he must be paid off if this is the only problem the payoff why does the dictator use such an inefficient method of pay off why doesn t he for example have the industry managed by a foreign mining company which can actually generate profits and then use these profits to

the economics of special interest politics the case of the tariff this paper investigates the interaction of politicians and special interest lobbies the goal is to model the equilibrium levels of redistributive policies such as taxes subsidies tariffs and regulatory decisions the model is applied throughout to the setting of tariffs by contributing to political campaigns special interest lobbies generate economic returns higher tariffs generate revenue for import competing industries through higher product prices higher milk support prices raise dairy farm income and so forth the lobby invests to maximize these net economic returns in evaluating their chances of election politicians weigh the favorable effects of special interest money against the unfavorable association with the lobby and the social cost of the redistributive policy section i explores the lobby s problem it describes a formalization of mancur olson s discussion of the voluntary provision of public goods and optimal contributions by lobbies to political campaigns section ii describes determination of the equilibrium tariff positions of each politician in a political campaign

does option trading have a pervasive impact on underlying stock prices the question of whether and to what extent option trading impacts underlying stock prices has been a focus of intense interest since options began exchange based trading in 1973 despite considerable effort no convincing evidence for a pervasive impact has been produced a recent strand of theoretical literature predicts that rebalancing by traders who hedge their option positions increases decreases underlying stock return volatility when these traders have net written purchased option positions this paper tests this prediction and finds a statistically and economically significant negative relationship between stock return volatility and net purchased option positions of investors who are likely to hedge hence we provide the first evidence for a substantial and pervasive influence of option trading on stock prices

green jobs economic impacts of renewable energy in germany abstract the labor market implications of large investment into renewable energy re are analyzed in this text although a growing re industry can be observed in germany the overall effect of large increases of re based electricity and heat generating technologies on the german economy require a careful model based analysis the applied model panta rhei has been used among others to evaluate the german energy concept in 2010 it takes positive and negative impacts of re into account the paper shows the overall effects under different assumptions for fossil fuel prices domestic installations and international trade the results are sensitive to assumptions on the development of re world markets and german exports to these markets almost all of these scenarios exhibit positive net employment effects under medium assumptions net employment of re expansion will reach around 150 thousand in 2030 only with assumptions for german re exports below today s level net impacts are slightly negative gross employment will increase from 340 thousand in 2009 to between 500 and 600 thousand in 2030

endogenous technological change and the policy mix in renewable power generation abstract this paper introduces the renewable power generation module which complements large scale macro econometric input output models by introducing technological change endogenously into the model so far technological change in renewable power generation technologies is either set exogenously autonomous energy improving technological change or price induced in economic models introducing endogenous technological change is necessary to adequately analyze not only the direct effects but also the indirect effects on important macro economic indicators such as growth employment welfare and trade as well as their feedback to the electricity sector the development of pv module and wind turbine prices is modeled using learning curves at the global scale i e depending on global capacity installed of each of these technologies national capacity additions in turn depend on global prices national policies and economic development while demand pull policies enhance capacity installations technology push policies do not seem to have a significant direct influence the empirical results confirm the overshooting of pv installations in germany which can be slowed down by introducing degression of feed in tariffs over time

technological change in economic models of environmental policy a survey this paper provides an overview of the treatment of technological change in economic models of environmental policy numerous economic modeling studies have confirmed the sensitivity of mid and long run climate change mitigation cost and benefit projections to assumptions about technology costs in general technical progress is considered to be a noneconomic exogenous variable in global climate change modeling however there is overwhelming evidence that technological change is not an exogenous variable but to an important degree endogenous induced by needs and pressures hence some environmenteconomy models treat technological change as endogenous responding to socio economic variables three main elements in models of technological innovation are i corporate investment in research and development ii spillovers from r d and iii technology learning especially learning by doing the incorporation of induced technological change in different types of environmental economic models tends to reduce the costs of environmental policy accelerates abatement and may lead to positive spillover and negative leakage

is there a relationship between economic conditions and political structure the results of this investigation into the relationship between political environment and economic well being are both disappointing and encouraging phone is the only measure of economic well being which is unambiguously and positively associated with democracies why this is true remains a mystery the two reasons discussed earlier are both plausible as in a third namely increasing availability of telephones reduces the costs of organizing special interest groups to the extent that active participation of special interests is a necessary condition for the emergence or continuation of democratic government telephones per capita will be related positively to the incidence of democracy

the dynamics of solar pv costs and prices as a challenge for technology forecasting an effective energy technology strategy has to balance between setting a stable long term framework for innovation while also responding to more immediate changes in technology cost and performance over the last decade rather than a steady progression along an established learning curve pv costs and prices have been volatile with increases or plateaus followed by rapid reductions the paper describes and considers the causes of recent changes in pv costs and prices at module and system level both international trends and more place specific contexts it finds that both module and system costs and price trends have reflected multiple overlapping forces established forecasting methods experience curves and engineering assessments have limited ability to capture key learning effects behind recent pv cost and price trends production scale effects industrial re organization and shakeouts international trade practices and national market dynamics these forces are likely to remain prominent aspect of technology learning effects in the foreseeable future and so are in need of improved more explicit representation in energy technology forecasting

stock price clustering on option expiration dates abstract this paper presents striking evidence that option trading changes the prices of underlying stocks in particular we show that on expiration dates the closing prices of stocks with listed options cluster at option strike prices on each expiration date the returns of optionable stocks are altered by an average of at least 16 5 basis points which translates into aggregate market capitalization shifts on the order of 9 billion we provide evidence that hedge rebalancing by option market makers and stock price manipulation by firm proprietary traders contribute to the clustering

political systems and distortions an empirical study this paper studies empirically why price distortions are more prevalent in some countries than in others we find no significant difference between democracies and dictatorships but frequent regime changes reduce distortions political systems factional subordinate that encourage redistributive activities rda tend to have more distortions allowing for different effects of rda in democracies and dictatorships there is a positive and significant effect of rda on distortions in dictatorships in democracies distortions destroying lobbying seems more important since no significant relation between rda and distortions can be found

economic impacts of higher oil and gas prices the role of international trade for germany the analysis concentrates on direct and indirect price increases induced shifts in international trade and structural changes in the oil importing economies the paper at hand asks whether a stabilizing effect via international trade and domestic structural change on the gdp of oil importing countries can be observed if a permanent oil price increase occurs at least for germany structural change from consumer goods to investment goods industry and an improvement of international competitiveness limit negative impacts of increased energy prices analysis is based on the extensive and disaggregated global ginfors model and the detailed inforge model for the german economy

evaluating the effect of technology transformation on the electricity utility industry abstract the technology shift from fossil fuelled systems to renewable energies has been promoted by governments with the purpose of decarbonising the power industry however rapid technology progress has prompted disruptive changes that transformed market structures incumbent electricity utilities particularly those based on fossil fuel plant are shifting from their stable and predictable situation to confront challenges from those that offer alternative energy services in this new environment the industry will benefit from mid to long term sector foresight the paper studies the potential impact of renewable energy sources res on electricity systems specifically on the generation and distribution businesses for this purpose a fairly detailed and integrated supply and demand based system dynamics model has been built to quantify the extent of their potential impact the model disaggregates the household sector which may generate a significant part of its electricity using rooftop solar energy this is illustrated by examining a utility engaged in the generation and distribution businesses in the colombian electricity market through simulation runs this paper concludes that subject to policy and all other things remaining equal solar rooftop generation is a major threat for utilities while the generation business is most affected in the short term the distribution business is the one most impacted in the long term and jointly they may induce the utility death spiral

pinning in the s p 500 futures abstract we show that standard poor s s p 500 futures are pulled toward the at the money strike price on days when serial options on the s p 500 futures expire pinning and are pushed away from the cost of carry adjusted at the money strike price right before the expiration of options on the s p 500 index anti cross pinning these effects are driven by the interplay of market makers rebalancing of delta hedges due to the time decay of those hedges as well as in response to reselling and early exercise of in the money options by individual investors the associated shift in notional futures value is at least 115 million per expiration day

unraveling the photovoltaic technology learning curve by incorporation of input price changes and scale effects in a large number of energy models the use of learning curves for estimating technological improvements has become popular this is based on the assumption that technological development can be monitored by following cost development as a function of market size however recent data show that in some stages of photovoltaic technology pv production the market price of pv modules stabilizes even though the cumulative capacity increases this implies that no technological improvement takes place in these periods the cost predicted by the learning curve in the pv study is lower than the market one we propose that this bias results from ignoring the effects of input prices and scale effects and that incorporating the input prices and scale effects into the learning curve theory is an important issue in making cost predictions more reliable in this paper a methodology is described to incorporate the scale and input prices effect as the additional variables into the one factor learning curve which leads to the definition of the multi factor learning curve this multi factor learning curve is not only derived from economic theories but also supported by an empirical study the results clearly show that input prices and scale effects are to be included and that although market prices are stabilizing learning is still taking place