causality in mean and causality in variance within the international steam coal market abstract the purpose of this paper is to investigate the integration of the steam coal market the analysis of dependencies between mean rates of return of prices on the steam coal market and volatility spillover was conducted using weekly data from the period 04 01 2002 to 30 12 2011 the prices of the world s largest exporters and importers on the pacific and atlantic markets were chosen to analyse the dependencies the methodology was based on the tests from cheung and ng 1996 and hong 2001 which allow for the analysis of granger causality both in mean and in variance the analyses indicate that the dependence between participants is not the same the strongest links were observed between the pairs of participants from the same market that is either the atlantic market or the pacific market and the price of australian coal turned out to be the most important factor in shaping other prices on the pacific market on the atlantic market the coal prices in the amsterdam rotterdam antwerp ara ports and the richards bay port had the greatest influence on coal prices and were the granger cause of prices in the pacific region

price and volatility spillovers across the international steam coal market we examine the degree of integration of the global steam coal market using a variety of measures we show that the australian market remains the dominant force in setting world coal prices followed by mozambique and south africa we find little evidence of asymmetric price and volatility transmission in fact most markets react to both positive and negative shocks in a symmetric manner the coal market displays a significant degree of integration although this effect varies over time while china provides a major source of volatility to the global coal market it is relatively insignificant in terms of price transmission

effects of speculation and interest rates in a carry trade model of commodity prices abstract the paper presents and estimates a model of the prices of oil and other storable commodities a model that can be characterized as reflecting the carry trade it focuses on speculative factors here defined as the trade off between interest rates on the one hand and market participants expectations of future price changes on the other hand it goes beyond past research by bringing to bear new data sources survey data to measure expectations of future changes in commodity prices and options data to measure perceptions of risk some evidence is found of a negative effect of interest rates on the demand for inventories and thereby on commodity prices and positive effects of expected future price gains on inventory demand and thereby on today s commodity prices

the globalization of steam coal markets and the role of logistics an empirical analysis abstract in this paper we provide a comprehensive multivariate cointegration analysis of three parts of the steam coal value chain export transport and import prices the analysis is based on a rich dataset of international coal prices in particular we combine data on steam coal prices with freight rates covering the period december 2001 until august 2009 at weekly frequency we then test whether the demand and supply side components of steam coal trade are consistently integrated with one another in addition export and import prices as well as freight rates for individual trading routes across regions and globally are combined we find evidence of significant yet incomplete integration we also find heterogeneous short term dynamics of individual markets furthermore we examine whether logistics enter coal price dynamics through transportation costs which are mainly determined by oil prices our results suggest that this is generally not the case

monetary policy homeostasis and the transmission mechanism philip howrey 1967 william poole 1970 and john kareken 1970 initiated a formal debate over monetary policy using some variant of an is lm model thomas sargent and neil wallace 1975 extend this work by incorporating a lucas type aggregate supply function and rational expectations in spite of the effort spent in following up on the seminal work by howrey poole and kareken little progress has been made in resolving the debate the central theme of this paper is that the lack of progress is the result of ignoring homeostasis and the nature of the transmission mechanism in order to illustrate the importance of homeostasis and the transmission mechanism this paper extends the standard is lm framework in two ways first it introduces a homeostatic mechanism that generates shortrun responses which correspond to standard is lm behavior and long run responses which reflect full employment second it provides for alternative transmission mechanisms by dropping the assumption that markets clear continuously the paper is organized as follows the model is developed in the next section the following section examines the role of homeostasis and the transmission mechanism in the debate over policy the final section presents the conclusions

a meta analysis of the export growth hypothesis abstract meta analysis is performed on a sample of seventy six studies that have empirically gauged the nexus between exports and economic growth the results show that studies that use aggregate exports report lower t ratios but studies that use oil and manufactured exports report higher t ratios the study also documents the existence of publication bias in the literature

neglected method of separating demand and supply in time series regression this article argues that in many markets quantity is demand determined in the short run but price is supply determined and that the dynamic restrictions between price and quantity implied by the model have been widely neglected in empirical research two examples illustrate our point the demand and supply relationships between inflation and unemployment and between the terms of trade and the trade balance in both specifying quantity as a function of lagged prices in demand and price as a function of lagged quantities in supply rather than concentrating on exogenous shift determinants is sufficient to separate demand and supply

defining geographic coal markets using price data and shipments data abstract given the importance of coal in world energy supply an analysis of the relevant geographic market is essential for consumers producers as well as for competition policy the purpose of this paper is to define the relevant economic market for steam and coking coal and to test the hypothesis of single world markets for these coal products methodologically the paper relies on two different tests for defining markets using both shipments data and price data the results from both methods point in the same direction in the case of coking coal the results indicate that the market is essentially global in scope and also that the market has become more integrated over time the results for steam coal show that the market is more regional in scope and there exist no clear tendencies of increased integration over time one policy implication of the finding that the steam coal market is more regional in scope and thus that the market boundary is smaller than if the market would have been international is that a merger and acquisition in this market likely would have been of a more concern for antitrust authorities than the same activity on the coking coal market

identification of interest rates and international capital flows the conventional paradigm that capital movements respond to differences in interest rates between countries and simultaneously reduce interest rate differentials has been difficult to demonstrate empirically this paper argues that such a demonstrati on may be feasible if a simultaneous model is specified that describe s the dynamics of adjustment and if a data interval is chosen that re veals the dynamics examination of u s and canadian data from the 19 60s supports the argument with monthly observations that paradigm is strongly supported with quarterly observations capital flows and i nterest rates are not significantly related copyright 1988 by mit press

unemployment inflation and monetarism the council s report provides a look at the 1969 71 game plan to disinflate by means of retarding aggregate demand the president elect s task force on inflation recommended as a first interim step that aggregate demand be slowed so as to bring the unemployment rate back to some equilibrium region around 4 5 percent what happened was that under the cover of the expectation and acceptance of such a limited step towards re equilibration the administration gradually tightened monetary and fiscal policy so severely as gradually to send the unemployment rate whizzing past the equilibrium zone to around 6 percent to my knowledge the theory of how and how well this medicine would act to cure the patient of his inflation was never spelled out by the council of economic advisers pp 533 34

primary commodity prices co movements common factors and fundamentals the behavior of commodities is critical for developing and developed countries alike this paper contributes to the empirical evidence on the co movement and determinants of commodity prices using nonstationary panel methods we document a statistically significant degree of co movement due to a common factor within a factor augmented var approach real interest rate and uncertainty as postulated by a simple asset pricing model are both found to be negatively related to this common factor this evidence is robust to the inclusion of demand and supply shocks which both positively impact on the co movement of commodity prices

dynamic steam coal market integration evidence from rolling cointegration analysis abstract the aim of the paper is twofold first to assess the dynamics of the integration process of the international steam coal prices and second to investigate the changes in the roles of particular coal prices in this market in the light of changes in the structure of supply and demand the analysis is based on steam coal prices set by the largest world exporters and importers on both the atlantic and the pacific markets we use weekly data spanning from october 5 2001 to march 28 2014 the aim is achieved in two stages during the first one we use the rolling trace test to identify the integration of the steam coal market and during the second one we apply the rolling weak exogeneity test to determine the roles of the participants of the international steam coal market namely price setters and price takers our main findings can be summarized in two observations firstly the main world steam coal prices are integrated and during the period when freight costs are higher the coal market integration is weaker and when the costs are lower the integration is stronger secondly the role of particular coal prices is not stable in time generally price setters appear in the market which covers greater shares in the physical coal trade although indonesia and russia have a great share in the global export their prices remain price takers during the whole period as a consequence although russia remains the largest coal exporter of the steam coal to the european market it cannot dictate its prices in this market

impact of the terms of trade on the u s trade balance a reexamination the right conclusion could be that there is a strong connection between the spectral components with specified periods a possible economic interpretation could identify a strong long term in the sense of the specified periods connection between both series but that would still not allow us to say anything concerning the size and direction of the time delay between the two series for such an analysis we would have to at least consider the phase angles between the components because of the ambivalent meaning of the phase angle in relation to the direction and number of periods the final answer could come only from the time domain analysis however the fact that only spectral components with longer periods i e smaller frequencies show coherency suggests something else in order to influence the balance of trade the changes in the terms of trade should be durable enough mathematical formalization of this concept of durability would therefore be helpful i would propose that further research be done in this respect

the evolution of hard coal trade in the pacific market abstract this article analyses the evolution of hard coal trade in the asia pacific region known as the pacific market from the 1980s to the present years it investigates the development of the trade pattern the nature of contracts the price setting the supply demand and the future of trade over the last two decades the international trade in the pacific market has achieved dramatic increases in coal commerce this achievement is due to strong demand in japan and north east asian countries and progressive coal export in australia and indonesia it is likely that this market will continue to expand and become a more important market in replacing the atlantic market in this market historically long term supply contracts were usual and concluded between producer and consumer even recently there are still annual contracts but with a small number of deals in contrast spot transactions are now becoming more important previously japan had been influential in price setting by establishing a benchmark price with australian coal suppliers afterward a reference price was becoming a trend nowadays spot price indices such as the barlow jonker the barlow jonker acr and globalcoal have become important to set the price the pacific market growth is not without problems the exporter countries particularly australia and indonesia have some challenges that if they are not resolved at present it would implicate the performance of the coal trade

an economic instrument for zero waste economic growth and sustainability if global problems such as climate change and waste remain unresolved society can choose either to continue attempting to incrementally reduce wastes and lessen impacts or to consider a more ambitious approach that paradoxically may be easier to implement this paper suggests how an approach designed to prevent waste and other global impacts could be based upon the established practices of precycling circular economic policy and recycling insurance a new economic instrument called precycling insurance is proposed so that decision making can be led by the market rather than by prescriptive regulation or educational campaigns the approach gains relevance now that china is developing a national law on the promotion of the development of circular economy 2006 elsevier ltd all rights reserved

market integration among electricity markets and their major fuel source markets dynamic price information flows among u s electricity wholesale spot prices and the prices of the major electricity generation fuel sources natural gas uranium coal and crude oil are studied multivariate time series methods applied to weekly price data show that in contemporaneous time peak electricity prices move natural gas prices which in turn influence crude oil in the long run price is discovered in the fuel sources market except uranium as these prices are weakly exogenous in a reduced rank regression representation of these energy prices

comment on a neglected method of separating demand and supply in time series regression by stephen e haynes and joe a stone this article examines some difficulties associated with the haynes stone model and attempts to clarify how the model can be justified as representing the hypothesis that quantity is demand determined and price is supply determined it also argues that the applications of such a model as was done by haynes and stone might not have resolved the controversies related to the phillips curve and the supply function of exports or imports

increasing convergence among european stock markets a recursive common stochastic trends analysis abstract the degree of convergence among three major european stock markets is analyzed within the framework of a recursive common stochastic trends analysis the results point towards a decreasing number of common stochastic trends influencing the stock markets i e the degree of convergence among european stock markets has been increased during the recent two decades

coal policies and trade barriers abstract the purpose of this paper is to treat in some depth recent work performed by the iea secretariat in analysing barriers to coal trade in member countries the concept of the producer subsidy equivalent pse as a measure of financial transfers to the coal industry is described along with its advantages and limitations as illustration summary results for the years 1982 1988 are given the paper concludes with a discussion of the arguments for and against maintaining support for domestic coal production

competition between biomass and food production in the presence of energy policies a partial equilibrium analysis abstract bioenergy has several advantages over fossil fuels for example it delivers energy at low net co 2 emission levels and contributes to sustaining future energy supplies the concern however is that an increase in biomass plantations will reduce the land available for agricultural production the aim of this study is to investigate the effect of taxing conventional electricity production or carbon use in combination with subsidizing biomass or bioelectricity production on the production of biomass and agricultural commodities and on the share of bioelectricity in total electricity production we develop a partial equilibrium model to illustrate some of the potential impacts of these policies on greenhouse gas emissions land reallocation and food and electricity prices as a case study we use data for poland which has a large potential for biomass production results show that combining a conventional electricity tax of 10 with a 25 subsidy on bioelectricity production increases the share of bioelectricity to 7 5 under this policy regime biomass as well as agricultural production increase a carbon tax that gives equal net tax yields has better environmental results however at higher welfare costs and resulting in 1 to 4 reduction of agricultural production

do oil prices respond to real interest rates abstract we show that the robustness of an inverse relationship between the real interest rate and real oil price depends crucially on how the real interest rate is calculated and the time frame of the sample consistent with earlier studies we find that the oil price falls with an unexpected rise in either u s or international ex ante real interest rates when the ex post real interest rate is used the oil price only falls with rises to short term rates 3 months or less additionally the response of the oil price to long term ex ante real interest rates must include the period through the mid 2000s for the inverse relationship to appear in contrast the oil price consistently falls with unexpected rises in short term real interest rates throughout the entire sample we draw two conclusions from the results the first is that the oil price is consistently responsive to short term u s and international real interest rates underlying the importance of storage second oil prices have become more responsive to long term real interest rates over time

is renewable energy effective in promoting growth abstract this paper applies panel data techniques to analyze the role of the various energy sources in economic growth for a set of 24 european countries 1990 2007 controlling for energy consumption and energy dependency the results suggest that the negative effect of the use of renewables supplants the positive effect of creating income by exploiting a natural resource locally and thus growth does not appear to improve with the change towards renewables the high costs of promoting renewables are probably being placed excessively upon the economy namely by increasing the costs of electricity tariffs thus inducing a deceleration in economic activity fossil fuels lead to dissimilar effects on growth while natural gas does not appear to be relevant in explaining growth coal hampers the capacity for growth whereas the use of oil stimulates that growth this is in line with productive structures that are deeply grounded in fossil fuels particularly oil

common stochastic trends in european stock markets the objective of the paper is to investigate whether price indices of different european stock markets display a common long run trending behaviour using cointegration analysis we provide empirical evidence of common stochastic trends among five important european stock markets over the period 1975 1991

investment practices in australian coal the practice and profit of quasi integration in the australia japan coal trade abstract the australian coal industry has frequently been described as a perpetual case of profitless prosperity industry literature on the subject usually sources this problem to government charges on the industry and to labour costs however these alleged problems do not appear to have diminished the enthusiasm for new investment in the industry this study argues that a more complete explanation must look at who is investing in the australian coal industry what the rationale for those investments is how they are financed and what their specific profitability is the particular examination made here is of the quasi integration investment practices of japanese trading steel and power companies easily the largest group of buyers in the international coal trade the close co operation between japanese government and business in this strategic raw materials industry is documented as are the methods of subsidised investment an examination of the financial performance of these companies australian coal investments shows that the profitability of their investments is significantly below that of most other investors in australian mining over a recent 5 year period taken together there is significant support for the conclusion that a process of co ordinated quasi integration has taken place and that the principal aim of such investments has not been to make profits from coal mining these results should make other prospective investors reconsider the benefits of quasi integration and should also be a public policy issue for australian governments seeking to encourage the development of profitable prosperity in the australian coal industry

the influence of south korean energy policy on opec oil exports abstract south korea is the fifth top oil importer worldwide with 64 of its oil coming from opec member countries over the last 30 years south korea accounted for a rapid increase in energy use this in turn led south korea to be totally dependent on oil imports due to this increase south korea has been experiencing drastic changes in its energy system which could potentially impact its dependence on opec oil import external and internal factors have forced south korea to change its energy strategy and targets these targets would be achieved by reducing its energy intensity and utilizing electricity and renewable energies in order to reduce its dependence on oil consumption low carbon green growth is one policy along with many other energy policies developed by south korea for reducing greenhouse gases thus this policy is receiving a remarkable attention today these national policies along with other international ones are needed to mitigate greenhouse gas emissions and promote other green initiatives this study puts emphasis on these policies as well as uses them to predict the future energy profile of south korea and how these policies will impact on oil imports from opec member countries

volatility spillovers for energy prices a diagonal bekk approach abstract we examine the relationship between return and volatility as well as the covolatility spillover for energy foreign currency and stock markets using the diagonal bekk model using daily crude oil natural gas and the coal prices as proxies for energy prices the s p500 index as a proxy for the u s stock market and the eur usd exchange rate as a proxy for the exchange rate we find robust evidence for the volatility spillover effects among the three markets also in the 16 out of 20 pairwise relationships in the five markets there are significant negative covolatility spillover effects in the four pairs involving coal there are positive and significant covolatility spillover effects we conclude that the energy markets and the stock market have stronger covolatility spillovers than others

specification of supply behavior in international trade supply behavior in international trade has been notoriously difficult to capture empirically indeed so few published supply studies exist that stern francis and schumacher s 1976 bibliographical survey of price elasticities in international trade devotes over 350 pages to demand estimates but barely 10 pages to supply estimates in recent years only goldstein and khan 1978 and dunlevy 1980 using simultaneous equation estimation techniques have reported estimates of supply behavior in international trade exogenous shocks to demand and supply for traded goods in general influence both quantity and price for supply estimates it is unclear a priori whether the response is more appropriately specified with quantity or price as the dependent variable however if supplying firms in an uncertain world pursue pricing strategies based on past market performance as in zabel 1981 the appropriate specification is a supply price equation in this case prices respond to lagged quantities which implies that the traditional supply quantity specification with present and past prices as explanatory variables cannot capture the dynamic supply behavior in this study we explore the hypothesis that previous attempts to estimate supply behavior have generally failed not only because of the well known problem of simultaneity bias but also because quantity rather than price was specified as the dependent variable section ii presents and discusses traditional supply quantity equations based on quarterly data for aggregate exports and imports for the united kingdom and the united states from 1947 to 1979 section iii briefly discusses the theoretical rationale of a supply price specification and presents estimates of supply price equations based on the same data section iv evaluates the empirical evidence to determine whether a supply quantity or supply price formulation is more appropriate and compares estimates of long run price elasticities of supply based on the two approaches a final section summarizes the conclusions

global market integration an alternative measure and its application global markets seem to be increasingly integrated but there is no well accepted measure of integration we show that the correlation across markets is a poor measure perfectly integrated markets can exhibit weak correlation we derive a new integration measure based on the explanatory power of a multi factor model and use it empirically to investigate recent trends in global integration for most countries there has been a marked increase in measured integration over the past three decades but this is not indicated by correlations among country indexes

commodity prices interest rates and the dollar this paper sheds light on recent fluctuations in commodity prices we investigate whether a decline in real interest rates and the us dollar contributes to higher commodity prices and whether commodity prices display overshooting behavior in response to changes in real interest rates we analyze the behavior of real prices of crude oil food metals and industrial raw materials the analysis is based on structural var models estimated on quarterly data over the period 1990q1 2007q4 our results suggest that commodity prices increase significantly in response to reductions in real interest rates moreover oil prices and prices of industrial raw materials tend to display overshooting behavior in response to such interest rate changes the evidence also suggests that a weaker dollar leads to higher commodity prices shocks to interest rates and the dollar are found to account for substantial shares of fluctuations in commodity prices

the impact of oil company investment on the world coal industry overcapacity and price destabilization 1973 1992 this paper investigates the impact of oil company investments on the world coal industry since the first oil price shock of 1973 it details the scope of these investments both in the usa and elsewhere and demonstrates how they have served to destabilize and depress international coal prices in particular it establishes a novel and robust link between oil company investment in us coal which is sold on the domestic market and the behaviour of us coal export prices

exogenous oil supply shocks how big are they and how much do they matter for the u s economy abstract the paper proposes a new measure of exogenous oil supply shocks the timing the magnitude and the sign of this measure may differ greatly from current state of the art estimates it is shown that only a small fraction of the observed oil price increases during oil crisis periods can be attributed to exogenous oil production disruptions exogenous oil supply shocks cause a sharp drop of u s real gdp growth after five quarters rather than an immediate and sustained reduction in economic growth and a spike in cpi inflation after three quarters overall exogenous oil supply shocks made remarkably little difference for the evolution of the u s economy since the 1970s although they did matter for some historical episodes

introduction to the asian energy security project project organization and methodologies the spectacular recent economic growth in the asia pacific region in general and in many of the economies of northeast asia in particular has spurred a vast expansion in the need for energy services and an expansion in the demand for the fuels that help to supply these services future projections suggest that the growth of fossil fuel use in northeast asia especially in china will have major consequences for financial and fuel markets and pollution both regionally and globally before the project described in this paper was initiated there was no ongoing forum for energy experts from all of the countries of the region to meet informally and in an unofficial capacity to discuss openly and in a targeted fashion the energy situations in their countries and to work together to evaluate the energy efficiency costs and benefits of different ways of meeting regional demand the asian energy security aes project provides such a forum and as such constitutes a unique resource in the engagement of the countries of northeast asia on the topic of energy security

international market integration for natural gas a cointegration analysis of prices in europe north america and japan this paper investigates the degree of integration of natural gas markets in europe north america and japan in the time period between the early 1990s and 2004 the relationship between international gas market prices and their relation to the oil price are explored through principal components analysis and johansen likelihood based cointegration procedure both of them show a high level of natural gas market integration within europe between the european and japanese markets as well as within the north american market at the same time the obtained results suggest that the european respectively japanese and the north american markets were not integrated

black gold fool s gold speculation in the oil futures market this paper addresses the question of whether the oil price spike of 2003 2008 was a bubble we document and discuss what is known about the level of speculation in the paper oil market we then analyze the dynamics of the term structure of futures prices both during the earlier period of 1985 2002 and during the spike the dynamics of the term structure changed in important ways during this latter period and we explain how this may have contributed to generating a bubble we also explain how this answers the puzzle of the lack of accumulating above ground inventories finally we discuss the implications for regulatory reform of the paper oil markets

assessing european stock markets co integration abstract this paper examines long run comovements in the uk french and german stock markets using cointegration techniques after fixing the power of the cointegration test no evidence is found of an increasing number of cointegrating vectors an alternative approach to measure increasing integration based on the speed of adjustment coefficients is proposed

the world price of coal a significant increase in the seaborne trade for coal over the past 20 years has unified formerly separate coal markets into a world market in which prices move in tandem by virtue of its large domestic market the usa has become the residual supplier and price setter in the world coal market changes in multifactor productivity have been the primary cause of the long term fluctuations in coal prices that have been observed in the usa since the end of the second world war and in the world coal market

securing a bioenergy future without imports the uk has legally binding renewable energy and greenhouse gas targets energy from biomass is anticipated to make major contributions to these however there are concerns about the availability and sustainability of biomass for the bioenergy sector a biomass resource model has been developed that reflects the key biomass supply chain dynamics and interactions determining resource availability taking into account climate food land and other constraints the model has been applied to the uk developing four biomass resource scenarios to analyse resource availability and energy generation potential within different contexts the model shows that indigenous biomass resources and energy crops could service up to 44 of uk energy demand by 2050 without impacting food systems the scenarios show residues from agriculture forestry and industry provide the most robust resource potentially providing up to 6 5 of primary energy demand by 2050 waste resources are found to potentially provide up to 15 4 and specifically grown biomass and energy crops up to 22 of demand the uk is therefore projected to have significant indigenous biomass resources to meet its targets however the dominant biomass resource opportunities identified in the paper are not consistent with current uk bioenergy strategies risking biomass deficit despite resource abundance

disequilibrium dynamics an empirical study despite the amount of attention devoted in economics to the study of equilibria the process by which an equilibrium can be attained is not well understood stephen smale 1977 called this the fundamental problem of economic theory this paper explores the microeconomics of the adjustment process by examining empirically the disequilibrium behavior of firms implications for the microeconomic foundations of macroeconomics are stressed the data from german industry describe the month by month price and output changes of individual firms as well as the firms own assessments of the levels of their inventories and unfilled orders because the data are qualitative use is made of the multivariate conditional logit model developed by marc nerlove and s james press 1973 1976 and extended by kawasaki and zimmermann section i discusses the underlying model of firm behavior and the significance of the inquiry for macroeconomics in section ii the econometric techniques are briefly described in section iii the empirical results are summarized and interpretations of the results are offered in section iv

stationarity changes in long run energy commodity prices abstract situated at the intersection of the literatures on speculative storage and non renewable commodity scarcity this paper considers whether changes in persistence have occurred in long run u s prices of the energy commodities crude oil natural gas and bituminous coal we allow for a structural break when testing for a break in persistence to avoid a change in the stochastic properties of prices being confounded by an unaccounted for deterministic shift in the price series we find that coal prices are trend stationary throughout their evolution and that oil prices change from stationarity to non stationarity in the decade between the late 1960s to late 1970s the result on gas prices is ambiguous our results demonstrate the importance of accounting for a possible structural shift when testing for breaks in persistence while being robust to the exact date of the structural break based on our analysis we caution against viewing long run energy commodity prices as being non stationary and conclude in favor of modeling commodity market fundamentals as stationary meaning that speculative storage will tend to have a dampening effect on prices we also cannot reject that long run prices of coal and with some hesitation gas follow a hotelling type rule in contrast we reject the hotelling rule for oil prices since the late 1960s early 1970s

real and monetary convergence between the european union s core and recent member countries a rolling cointegration approach abstract we use rolling cointegration to measure the convergence of base money m2 the cpi and industrial output between germany and france and recent eu members and some transition countries that are now joining the eu countries that joined the eu previously exhibit time varying cointegration with the core countries over the 1980 2000 sample period cointegration for the transition economies was comparable for m2 and prices but not for monetary policy and industrial output thus a peg to the euro soon after accession is feasible for the east european countries but the benefits of joining the euro zone are as yet limited

the roles of inter fuel substitution and inter market contagion in driving energy prices evidences from china s coal market abstract coal has been dominating energy supply and consumption in china with the country becoming the largest energy supplier and consumer worldwide due to inter fuel substitution of crude oil and inter market contagion of international coal market china s coal price might be interrelated with crude oil price and international coal price however the precise roles of these two effects in determining china s coal price are unknown this paper contributes to previous literature by investigating this issue we find that co movements between china s coal price and crude oil price largely hinge on the shares of oil and coal in china s energy mix while its co movements with international coal price depend on scales of coal trade inter fuel substitution dominated the interaction of china s coal market with other energy types but the importance of inter market contagion has been increasing we also find that china might have become an originator for driving the returns of crude oil and international coal in particular after 2008 furthermore china s coal market is still a net volatility recipient for shocks from both crude oil market and international coal market given the increased integration of global energy markets we anticipate this paper to provide a better understanding on the dynamic changes in china s coal prices

inventories and sticky prices more on the microfoundations of macroeconomics the role of inventories in making prices sticky is studied by analyzing a dynamic linear quadratic model of a monopoly firm facing stochastic demand but able to store its finished goods in inventory it is shown that in contrast to the usual presumption firms that exhibit the smallest output responses to demand fluctuations may also exhibit the smallest price fluctuations specifically firms which have very flexible inventory storage facilities or are subjected to very transitory demand shocks will rely on inventories as buffers and will change neither production nor price very much on the other hand firms which have very inflexible storage facilities or whose demand shocks are quite permanent will display large swings in both price and output the standard assumption about inventory carrying costs that has been used in the literature that they are linear is shown to imply that production is impervious to fluctuations in demand it is also established that prices may respond more strongly to positive demand shocks than to negative ones if it is impossible to hold negative inventories i e to have unfilled orders the model offers an explanation for stickiness in relative prices however under certain circumstances it may help explain the persistence of inflation this abstract was borrowed from another version of this item

biotechnology as a new techno economic paradigm that will help drive the world economy and mitigate climate change abstract a techno economic paradigm embraces a whole constellation of technically and economically interrelated innovations and influences most industries and an entire phase of economic development its full potential to drive and shape economic growth can only be realized after far reaching reforms have been made in the socio institutional frameworks of major economies and the world economy in close association with ict biotechnology or the trio of biotechnologies red biomedicine green plant breeding and white industrial is now capable of such a role although the necessary reforms remain to be made this paper shows how far and in what sense it has reached technological maturity and what mismatches between it and the socio institutional framework are obstructing its further development and diffusion it argues that biotechnology green and white is needed to play a key role in the struggle against climate change which in turn can be expected to draw out its potential

the role of underground storage in the dynamics of the us natural gas market a threshold model analysis abstract natural gas is an important source of energy in the global economy hence understanding the drivers of its prices is of significant interest for the many economic agents this paper investigates the role of inventories for the dynamics of the u s natural gas market our contribution is twofold first within the threshold structural var framework we demonstrate that in a low inventory regime spot prices are more responsive to economic fundamentals in comparison to situation in which the inventories are high second we present evidence that the level of natural gas inventories have a significant effect on the relationship between spot and futures prices

the evolution of hard coal trade in the atlantic market abstract this article analyses the evolution of hard coal trade in west europe known as the atlantic market from the 1980s to the end of 2002 it investigates the development of trade pattern nature of contracts price setting supply demand and the future of trade the region s demand has underpinned steam coal in the recent past in 2002 steam coal imports reached 155 0 mt while coking coal imports were 43 2 mt the market is progressing to become a perfect market transparent and simple in operation the spot market for coal has made the transaction bring into line the current market situations historically long term contracts were usual and concluded between producer and consumer recently there are still annual contracts but with a small number of deals the percentage of spot market has risen from 14 in 1983 to 80 in 2003 previously coal price settlement was referenced by south africa s and the us offers now spot price indices have become important in price setting the increasing power needs the advantages of reserves conditions and market systems open the opportunities for coal demand in the forthcoming years however these opportunities are not without problems the demand for reducing environmental impacts and the efforts for seeking capital to fund the investment are some of the challenges to be addressed