democracy financial openness and global carbon dioxide emissions heterogeneity across existing emission levels summary the determinants of co 2 emissions have attracted many researchers over the past few decades most of studies however ignore the possibility that effect of independent variables on co 2 emissions could vary throughout the co 2 emission distribution we address this issue by applying quantile regression methods we examine whether greater democracy and more financial openness consistently reduce emissions among the most and least emission nations our results show that the effect of democracy on co 2 emissions is heterogeneous across quantiles among the most emissions nations greater democracy appears to reduce emissions but more financial openness does not appear to reduce it

competition and corporate performance are people right to think that competition improves corporate performance my investigations indicate first that there are some theoretical reasons for believing this hypothesis to be correct but they are not overwhelming furthermore the existing empirical evidence on this question is weak however the results reported here based on an analysis of around 670 u k companies do provide some support for this view most important i present evidence that competition as measured by increased numbers of competitors or by lower levels of rents is associated with a significantly higher rate of total factor productivity growth

market share market value and innovation in a panel of british manufacturing firms this paper examines the empirical relationship between technological innovations market share and stock market value new developments in the estimation of dynamic count data models are used to control for unobserved firm specific heterogeneity we find a robust and positive effect of market share on observable headcounts of innovations and patents although increased product market competition in the industry tends to stimulate innovative activity furthermore the impact of innovation on market value is larger for firms with higher market shares we argue that our results are consistent with models where high market share firms have incentives to pre emptively innovate

is trade good or bad for the environment sorting out the causality we seek to contribute to the debate over globalization and the environment by asking what is the effect of trade on a country s environment for a given level of gdp we take specific account of the endogeneity of trade using exogenous geographic determinants of trade as instrumental variables we find that trade tends to reduce three measures of air pollution statistical significance is high for concentrations of so2 moderate for no2 and lacking for particulate matter although results for other environmental measures are not as encouraging there is little evidence that trade has a detrimental effect on the environment

does trade liberalization increase national energy use abstract this paper utilises the theoretical principles of antweiler et al antweiler w b r copeland and m s taylor 2001 is free trade good for the environment american economic review 91 4 pp 877 908 to estimate empirically the linkages between trade liberalization and energy use focusing on scale technique and composition effects results suggest that trade will increase energy use for the mean country in the sample

is the troika bad for the environment an analysis of eu countries environmental performance in times of economic downturn and austerity memoranda abstract in this paper we examine the effect of the current economic crisis on the environmental performance of the eu countries by employing hierarchical linear multilevel hlm modeling we find that for the period 2000 2015 a drop in the national gdp a recession effect as well as endorsing a memorandum of understanding mou for receiving a imf eu ecb financial rescue package a troika effect have non significant to positive impacts on a number of national environmental quality and policy indicators over and above other economic political and governance predictors for eurozone and non eurozone countries alike nevertheless this changes drastically if we examine these two factors interaction experiencing a recession while being a recipient of a troika sponsored rescue package has detrimental effects on an eu country s national environment

overnight information and stochastic volatility a study of european and us stock exchanges abstract this paper provides a comprehensive evaluation of the predictive ability of information accumulated during nontrading hours for a set of european and us stock indexes we introduce a stochastic volatility model which conditions on lagged overnight information distinguishes between the nontrading periods of weeknights weekends holidays and long weekends and allows for an asymmetric leverage effect on the impact of overnight news we implement bayesian methods for estimation and ranking of the empirical models and find two key results i there is substantial predictive ability in financial information accumulated during nontrading hours and ii the performance of stochastic volatility models improves considerably by separating the asymmetric impact of positive and negative news made available over weeknights weekends holidays and long weekends

does trade liberalization lead to environmental burden shifting in the global economy abstract does trade liberalization lead to the outsourcing of pollution from industrialized countries to developing countries according to the pollution haven hypothesis international trade is a key channel through which richer countries can geographically dissociate consumption from production of goods we examine whether and how trade liberalization via preferential trade agreements ptas facilitates the shifting of consumption based environmental burdens from developed countries via imports to poorer countries via exports based on panel data analysis of 183 countries from 1987 to 2013 we find partial evidence for trade induced environmental burden shifting while we observe an increase in footprint exports from low income countries when these countries liberalize trade this is not matched by an increase in footprint imports of high income countries our results also show that environmental clauses in ptas and participation in international environmental agreements do not influence the relationship between trade liberalization and ecological footprint movements however domestic institutions have a significant effect on the trade induced distribution of environmental burdens these findings suggest that ptas as a policy tool for trade liberalization are per se unlikely to induce exploitation of low income countries natural capital by wealthier nations however they suggest that political incentives inherent to democratic institutions encourage environmental burden shifting

world war ii as reflected on capital markets abstract historical events are reflected in asset prices we analyze government bond prices of five european countries traded on the swiss bourse during wwii apart from the official outbreak of wwii loss and gain of national sovereignty influenced the capital market

revisiting the environmental kuznets curve in malaysia the role of globalization in sustainable environment abstract the present study examines the presence of environmental kuznets curve ekc in malaysia by investigating impact of globalization including overall social economic and political on ecological footprint in the malaysian economy using quarterly data from 1970 to 2018 this research utilizes the quantile autoregressive distributed lag qardl method this approach is useful as it depicts the causality patterns through various quantiles of the globalization and environmental degradation by providing more comprehensive explanations of the over all dependence among the aforementioned variables almost ignored by the traditional approach for instance ardl and ols the outcomes of qardl showed that the error correction coefficient is significant with the anticipated negative sign for all quantiles this outcome provides evidence on the presence of considerable return to the long run equilibrium association between the factors of interest and environmental degradation overall the results recommended that overall globalization and economic globalization enhance the level of environmental degradation in the long run however political and social globalization help to reduce the level of environmental degradation in the long term moreover the results of qardl also confirmed the existence of inverted u shape curve in the malaysian economy in the shorter run period this study found a significant negative impact of overall globalization and political globalization on environmental degradation the results recommended that the malaysian government and policymakers need to give more attention to social and political globalization to achieve the goals of sustainable environment in the long run equilibrium

a behavioral explanation for the negative asymmetric return volatility relation abstract we examine the short term dynamic relation between the s p 500 nasdaq 100 index return and changes in implied volatility at both the daily and intraday level neither the leverage hypothesis nor the volatility feedback hypothesis adequately explains the results alternatively we propose that the behavior of traders from the representativeness affect and extrapolation bias concepts of behavioral finance is consistent with our empirical results of a strong daily and intraday negative return implied volatility relation moreover both the presence and magnitude of the negative relation and the asymmetry between return and implied volatility are most closely associated with extreme changes in the index returns we also show that the strength of the relation is consistent with the implied volatility skew

does economic integration damage or benefit the environment africa s experience abstract the leaders of african nations have committed to the establishment of the continental free trade area cfta over the coming years improved links among the african nations via increased intra regional trade have been considered as an essential mechanism to produce desired growth run overs and to support regional economic improvement however remarkable theoretical and empirical evidence has shown that increased trade might damage the environment and therefore may hinder the effort towards sustainable development and poverty reduction on the continent the present paper seeks to investigate and test the impact of intra africa trade using two measurements of environmental pollutants namely co2 and mp10 whilst integrating economic growth and energy consumption the study used a panel dataset regarding 46 african countries over the period 1990 2017 to carry out the empirical analysis the latest panel estimation techniques were employed more specifically and for the urbaneness purpose we employed a parametric technique which is dynamic ols and a non parametric approach which is fmols the results of both methods suggested that intra africa trade improved environmental quality on the continent in addition the results confirmed the presence of the environmental kuznets curve ekc hypothesis the findings also indicated that whilst the consumption of energy played a vital role in the deterioration of the environment its impact remained marginal overall the results implied that intra regional trade and the environment quality were mutually supportive in africa

trade openness and environmental quality international evidence we examine the relationship between trade openness and the environment in a cross country panel using the emission of particulate matter pm10 as the basic indicator of environmental quality the panel cointegration test results show a long run relationship between particulate matter emissions trade openness and economic growth we find that increased trade openness leads to environmental degradation for the global sample however the results differ according to the income of countries trade openness has a benign effect on the environment in high income countries but a harmful effect in middle and low income countries these results are generally robust to different measures of trade openness and environmental quality interestingly and significantly the results are consistent with the popular notion that rich countries dump their pollution on poor countries finally we find evidence of a feedback effect between trade openness and particulate matter emissions for the global sample as well as different income groups of countries

reexamining the empirical evidence for an environmental kuznets curve this paper uses an updated and revised panel data set on ambient air pollution in cities worldwide to examine the robustness of the evidence for the existence of an inverted u shaped relationship between national income and pollution we test the sensitivity of the pollution income relationship to functional forms to additional covariates and to changes in the nations cities and years sampled we find that the results are highly sensitive to these changes and conclude that there is little empirical support for an inverted u shaped relationship between several important air pollutants and national income in these data

the environment left wing political orientation and ecological economics the objectives of this commentary are twofold the first is to examine the relationship between a party s position within the left right political spectrum and its stance on environmental issues as stated in party manifestos the second is to examine the relationship between individuals ideological orientation and pro environmental beliefs attitudes and self reported behavior equality distributional concerns and market skepticism are typically regarded as defining factors of left wing political orientation our results suggest that left wing parties and individuals are also more pro environmental than their right wing counterparts ecological economics similarly embraces sustainability efficient resource allocation and equitable distribution and is skeptical towards the ability of unregulated markets to achieve these objectives the hypothesis is put forward that ecological economics is more likely to be supported by left wing parties and individuals

macroeconomic uncertainty precautionary saving and the current account abstract the relationship between current account developments and changes in the macroeconomic environment is a key issue in open economy macroeconomics this paper extends the standard intertemporal model of the current account to incorporate the effects of macroeconomic uncertainty on external saving behavior it is shown that the greater the uncertainty in national cash flow defined as output less investment less government consumption the greater will be the incentive for precautionary saving and ceteris paribus the larger the current account surplus empirical support for the model is found using post war quarterly data for the united states japan and the united kingdom as well as a long time series 1919 1990 for the united states

do leveraged exchange traded products deliver their stated multiples abstract using the longest history of a u s equity market index this paper simulates the return deviation and multiple deviation for leveraged exchange traded products letps with different rebalancing frequencies including daily monthly annually and every five years over various holding periods we find that the general perception that daily rebalanced letps are not suitable for long term strategies is not substantiated advancing the analysis we construct a comprehensive framework that determines the deviation of an letp s effective multiple from its stated product multiple under various rebalancing frequencies and holding period scenarios the empirical framework and results from this paper hold the promise of guiding regulators policy makers and investors in their understanding of the tracking performance of letps

trade in environmental goods evidences from an analysis using elasticities of trade costs negotiations on the liberalization of environmental goods egs and services within the wto doha round mandated in november 2001 are facing specific challenges conflicting interests and differing perceptions of the benefits of increased trade in egs were reflected in different approaches proposed for determining egs using import data of 34 organisation for economic co operation and development oecd member countries and from a sample of 167 countries from 1995 to 2012 we discuss the trade effect of reducing barriers on egs we analyze the lists of egs proposed by the asia pacific economic cooperation and oecd using a translog gravity model we found that removing tariff barriers for egs will have a modest impact because for the biggest importers and exporters elasticities of trade costs are very low while for most trading relationships they are very high making it difficult for exporters to maintain their markets overall our results suggest that because of their substantial effect on international trade future negotiations on egs should also address the issues of standards and nontariff barriers

world war ii events and the dow jones industrial index abstract this paper investigates which events of world war ii wwii the us investors at that time considered as turning points structural breaks of the war the empirical study employs daily dow jones industrial average stock index and volatility from january 1939 to december 1945 and applies structural shift oriented test to determine endogenously the structural breaks during the wwii period results show that the majority of the wartime events on and off the battlefield labelled important by historians did result in structural breaks in both price movement and stock returns volatility risk these results have major implications for investors of the present and future

investigation of the environmental kuznets curve for carbon emissions in malaysia do foreign direct investment and trade matter abstract environmental degradation has become a central issue of discussion among the economists and environmentalists in view of malaysia s position as one of the main contributors to co2 emissions in asia and its status as a fast growing economy it is vital therefore to conduct a study to identify the relationship between economic growth and co2 emissions for malaysia this study attempts to examine empirically the environmental kuznets curve hypothesis for malaysia in the presence of foreign direct investment and trade openness both in the short and long run for the period 1970 to 2008 the bounds testing approach and granger causality methodology are applied to test the interrelationships of the variables the results of our study indicate that the inverted u shaped relationship does exist between economic growth and co2 emission in both the short and long run for malaysia after controlling for two additional explanatory variables namely fdi and trade importantly the results of the study also provide some crucial policy recommendations to the policy makers

does trade openness improve environmental quality the literature on trade openness economic development and the environment is largely inconclusive about the environmental consequences of trade this study treats trade and income as endogenous and estimates the overall impact of trade openness on environmental quality using the instrumental variables technique we find that whether or not trade has a beneficial effect on the environment varies depending on the pollutant and the country trade is found to benefit the environment in oecd countries it has detrimental effects however on sulfur dioxide so2 and carbon dioxide co2 emissions in non oecd countries although it does lower biochemical oxygen demand bod emissions in these countries we also find the impact is large in the long term after the dynamic adjustment process although it is small in the short term

an analysis of industry concentration in south african manufacturing 1972 2001 this article examines industry concentration for the south african manufacturing sector over the 1972 2001 period for the three digit industry classification the article notes both the high level of industry concentration in south african manufacturing and a rising trend in concentration across a wide range of industries as measured by the gini and rosenbluth coefficients the article examines the impact of concentration on investment rates using a dynamic heterogeneous panel estimation methodology we find that increased concentration unambiguously lowers investment rates

the carbon footprint of greek households 1995 2012 abstract the goal of this paper is twofold i to investigate the carbon footprint of greek households throughout the period 1995 2012 in order to identify the main socio economic factors that affect ghg emissions and ii to evaluate the effectiveness of the implemented policies to tackle climate change in this a consumption based emissions inventory approach is applied the analysis is based on an environmentally extended input output model including direct co2 emissions from households indirect co2 emissions from electricity consumption and indirect co2 emissions from energy used in the production of goods and services purchased by households domestic or imported statistical analysis and appropriate regression models were developed in order to identify the main factors influencing the carbon footprint of greek households the results indicate that the observed trends during the period 1995 2008 can be attributed to the effect of high economic growth this trend is partially counterbalanced by favorable weather conditions and the implementation of greenhouse mitigation policies and measures mainly in the supply side since 2008 the shrinking household income is the dominant driver in addition the effectiveness of energy conservation policies and measures in place is rather low while the effect of imports is limited

energy intensity developments in 40 major economies structural change or technology improvement this study analyzes energy intensity trends and drivers in 40 major economies using the wiod database a novel harmonized and consistent dataset of input output table time series accompanied by environmental satellite data we use logarithmic mean divisia index decomposition to 1 study trends in global energy intensity between 1995 and 2007 2 attribute efficiency changes to either changes in technology or changes in the structure of the economy and 3 highlight sectoral and regional differences we first show that heterogeneity within each sector across countries is high these general trends within the sectors are dominated by large economies first and foremost the united states in most cases heterogeneity is lower within each country across the different sectors regarding changes of energy intensity at the country level improvements between 1995 and 2007 are largely attributable to technological change while structural change is less important in most countries notable exceptions are japan the united states australia taiwan mexico and brazil where a change in the industry mix was the main driver behind the observed energy intensity reduction

participation in gvcs and co2 emissions abstract this paper attempts to explore the determinants of co2 emissions in the context of international trade while there exist studies that examine the roles of horizontal specialization and inter industry trade transactions little previous research attention has been paid to the roles of vertical specialization and intra industry trade transactions in affecting co2 emissions to fill the knowledge gap this study uses the panel data of 62 countries and regions for the period of 1995 2011 to estimate the effect of participation in global value chains gvcs on per capita co2 emissions major findings include 1 the relationship between participation degrees in gvcs and per capita co2 emissions is found to be inversely u shaped at the aggregate economy level and for most individual industries 2 per capita gdp shows an n shaped relationship with per capita co2 emissions and 3 benign drivers of co2 emissions include r d energy conservation and population control it can be concluded that countries with low gdp or gvc participation degrees are expected to experience worsening co2 emissions in the short or even medium run this trend however can be moderated or even reversed with more r d investments

trade the pollution haven hypothesis and the environmental kuznets curve examining the linkages abstract this paper examines the extent to which the ekc inverted u relationship can be explained by trade and specifically the migration or displacement of dirty industries from the developed regions to the developing regions the pollution haven hypothesis phh using detailed data on north south trade flows for pollution intensive products the evidence for the phh is assessed emissions of 10 air and water pollutants are then estimated controlling for trade openness structural change and dirty north south trade flows evidence of pollution haven effects is found although such effects do not appear to be widespread and appear to be relatively small compared to the roles played other explanatory variables

output stock volatility and political uncertainty in a natural experiment germany 1880 1940 why does stock volatility increase when output declines the theory of investment under uncertainty implies that political uncertainty may simultaneously increase volatility and reduce output though cause and effect are typically hard to separate the transition from imperial to weimar germany offers a natural experiment because major political events left clear traces on stock prices current and past increases in volatility are associated with output declines consistent with u s experience however political events are more clearly the source of volatility and the results support the view that the relationship between volatility and output ref lects the joint effects of political factors why does stock volatility change over time and why is it higher in recessions though the basic facts are well established huang and kracaw 1984 schwert 1989a romer 1990 pindyck 1991a the causal link between volatility and business slumps is unclear slumps may cause volatility volatility may cause slumps or both may be the consequence of some other more clearly exogenous factor political uncertainty may represent such an exogenous factor consider the great depression in the united states major changes in economic policy occurred in the 1930s and even larger changes were a possibility the highly volatile stock market of the 1930s may very well have ref lected a nonnegligible f luctuating probability that the united states would go socialist the same uncertainty about economic policy may also have caused a slump in business investment and reduced consumer spending though the explanation has appeal political uncertainty was not clearly exogenous a critic could say that higher volatility and the radical nature of policy debate were consequences of the decline in output and the depression itself had other causes as schwert 1989b points out in a more general context we can easily construct links between volatility and the business cycle but causation is hard to pin down this paper looks at stock volatility and output in a case marked by a clear exogenous political shock until the start of world war i in 1914 imperial germany had a stable limited government weimar germany after the war

are left wing party strength and corporatism good for the environment evidence from panel analysis of air pollution in oecd countries abstract the effect of left wing party strength and corporatism on air pollution levels in up to 21 oecd countries over the period 1980 or 1990 1999 is tested with both fixed effects and random effects estimators controlling for scale composition technique as well as aggregate time effects robust evidence is found that parliamentary green left libertarian party strength is associated with lower pollution levels the rise of ecologically oriented parties has thus had a real impact on air pollution levels traditional left wing party strength is possibly also associated with lower pollution levels but the evidence is less consistent and robust combined left wing party strength in government is possibly associated with higher pollution levels but this result is also far from robust and is practically small no evidence is found for a consistent systematic impact of corporatism on pollution levels

domestic and international influences on green taxation economists have made a strong case for the relative efficiency of market based mechanisms for environmental regulation such as cap and trade and green taxes yet the spread of these forms has been limited and traditional command and control regulation still predominates the authors explain geographical and temporal variation in green tax burdens by considering their domestic and international determinants modeling international influences using spatial lags hypotheses are tested using panel data on organisation for economic co operation and development member states from 1995 to 2004 at the domestic level the authors show that green tax burdens are influenced by the left right and environmental positions of legislative medians and the power of the energy producing sector among other factors the authors also show that ideas about policy diffuse through international networks generated by trade and environmental intergovernmental organizations but they do not find compelling evidence for intern

macroeconomic volatility and welfare in developing countries macroeconomic volatility and welfare in developing countries an introduction norman v loayza romain ranciere luis serven and jaume ventura macroeconomic volatility both a source and a reflection of underdevelopment is a fundamental concern for developing countries this article provides a brief overview of the recent literature on macroeconomic volatility in developing countries highlighting its causes consequences and possible remedies to reduce domestic policy induced macroeconomic volatility by controlling the level and variability of fiscal expenditures by keeping inflation low and stable and by avoiding price rigidity including that of the exchange rate which eventually leads to drastic adjustments the ability to conduct countercyclical fiscal policies is crucial and it depends largely on the ability of the authorities to reduce public indebtedness to internationally acceptable levels establish a record of saving in good times to provide for bad times and develop credibility tha

environmental policy design innovation and efficiency gains in electricity generation this paper explores the relationship between environmental regulation innovation and competitiveness drawing upon a unique dataset on environmental regulations directed at combustion plants a global dataset of power plants and a global dataset of environmental patents the analysis is conducted in two stages first a nonparametric frontier analysis is implemented to estimate efficiency scores including a measure of technological innovation based on patent stocks second econometric methods are applied to analyse the role of policy stringency and policy design on efficiency our estimation sample covers thermal power plant sectors in 20 countries from 1990 to 2009 the results show that the stringency of environmental regulations is a significant determinant of productive efficiency with respect to pollutant emissions as well as fuel use however these effects turn negative once the level of stringency leaps over a certain threshold in addition the paper concludes that the positive effect of regulatory stringency can be diminished by a negative effect of regulatory differentiation with measures which are differentiated across plant size and age having negative consequences and these effects are increasing over time this finding is important given the prevalence of size and vintage differentiated policies in many countries finally it is found that integrated approaches to environmental innovation are more likely to bring about efficiency improvements than end of pipe technologies

is economic volatility detrimental to global sustainability in a dynamic panel data model allowing for error cross section dependence output volatility is found to impede sustainable development through a financial development channel liquidity liability ratio output volatility exerts a significant effect on depletion of natural resources a key component of sustainability low income countries low energy intensity countries and low trade share countries tend to be especially vulnerable to macroeconomic volatility and shocks the findings highlight the interaction between global financial markets and the wider economy as a key factor influencing sustainable development with important implications for macroeconomic and environmental policies in an integrated global green economy

macroeconomic volatility and welfare in developing countries an introduction macroeconomic volatility both a source and a reflection of underdevelopment is a fundamental concern for developing countries their high aggregate instability results from a combination of large external shocks volatile macroeconomic policies microeconomic rigidities and weak institutions volatility entails a direct welfare cost for risk averse individuals as well as an indirect one through its adverse effect on income growth and development this article provides a brief overview of the recent literature on macroeconomic volatility in developing countries highlighting its causes consequences and possible remedies it then introduces the contributions of a recent conference on the subject sponsored by the world bank and pompeu fabra university barcelona

crises volatility and growth how do volatility and liquidity crises affect growth when credit is constrained a bias toward short term debt can arise in financing long term investments generating maturity mismatches and leading potentially to liquidity crises the frequency of liquidity crises and the volatility of growth are found to have independent negative effects on growth financial development however dampens the growth cost of volatility but only in the case of normal volatility the growth cost of volatility therefore depends critically on the composition of normal and abnormal volatility the latter being more costly for growth

temporal change of china s pollution terms of trade and its determinants abstract based on the world input output database wiod this study employed a revised pollution terms of trade ptt indicator to investigate the temporal change of china s environmental cost relative to its economic gains from international trade from 1995 to 2009 the results show that china has ptt larger than 1 indicating that china emits more emissions to obtain each unit of value added from exports than its trade partners over the period china s ptt first decreased from 1995 to 2001 and then increased from 2001 to 2009 the further decompositions show that improving technology is the leading driving force to decrease ptt while the change in global trade pattern is the leading force increasing ptt especially after 2001 we further decomposed the temporal change of china s ptt by income group of the trading partners the results show that the change in the global trade pattern is the crucial driving force behind the different changes of ptt by income group

what makes the stock market jump an analysis of political risk on hong kong stock returns abstract this paper employs a components jump volatility filter to investigate the possible market impact of political risk the filter operates by identifying jump return dates which are then associated with political events allowing us to measure the market return and volatility effects of political announcements our empirical results show that political developments in hong kong have a significant impact on its market volatility and return the results have some interesting implications for option pricing and political risk management

the environmental consequences of trade evidence from subnational trade flows abstract the debate over the environmental consequences of free trade is not only quite heated but also entails significant policy ramifications recently cross sectional analysis at the country level has made use of exogenous determinants of trade to identify the causal effect of trade on the environment finding moderate evidence of a beneficial impact of expanded trade on environmental quality given the stakes involved we revisit this finding using subnational data on trade flows across us states and several measures of pollution not only does the analysis shed further light on the debate at the international level but also addresses a heretofore unexamined question does greater inter regional commerce at the subnational level harm the environment our findings are striking providing further evidence against a negative environmental impact of trade for the majority of measures analyzed however several sources of heterogeneity arise that are noteworthy

the effects of terrorism and war on the oil price stock index relationship abstract the effects war and terrorism have on the covariance between oil prices and the indices of four major stock markets the american s p500 the european dax cac40 and ftse100 using non linear bekk garch type models are investigated the findings indicate that the covariance between stock and oil returns is affected by war a tentative explanation is that the two wars examined here predispose investors and market agents for more profound and longer lasting effects on global markets on the other hand terrorist incidents that are one off unanticipated security shocks only the co movement between cac40 dax and oil returns is affected and no significant impact is observed in the relationship between the s p500 ftse100 and oil returns this difference in the reaction may tentatively be interpreted as indicating that the latter are more efficient in absorbing the impact of terrorist attacks

are we consuming too much this paper articulates and applies frameworks for examining whether consumption is excessive we consider two criteria for the possible excessiveness or insufficiency of current consumption one is an intertemporal utility maximization criterion actual current consumption is deemed excessive if it is higher than the level of current consumption on the consumption path that maximizes the present discounted value of utility the other is a sustainability criterion which requires that current consumption be consistent with non declining living standards over time we extend previous theoretical approaches by offering a formula for the sustainability criterion that accounts for population growth and technological change in applying this formula we find that some poor regions of the world are failing to meet the sustainability criterion in these regions genuine wealth per capita is falling as investments in human and manufactured capital are not sufficient to offset the depletion of natural capital

why cooperate public goods economic power and the montreal protocol this paper develops a correlated probit model to describe dichotomous choices that may contain a public goods component or some other forms of interdependency the key contribution of the paper is to formulate tests for interdependent behavior among agents in particular we examine the decisions by nations whether or not to ratify the montreal protocol on substances that deplete the ozone layer specifically we reject free riding as a motive for not ratifying the protocol and we find little evidence that individual nations were influenced by the behavior of their largest trading partners hence the data suggest that with respect to the montreal protocol most nations acted without regard for the actions of other nations

the participation decision versus the level of participation in an environmental treaty a spatial probit analysis abstract this paper represents treaty participation as a two stage game for which nations first decide whether or not to participate and then they choose their level of participation the resulting subgame perfect equilibrium is used to derive a reduced form equation for estimating and separating the influences of the variables at the two decision stages this spatial probit equation forms the basis for a full information maximum likelihood estimator that accounts for the simultaneity bias associated with public good spillins at both stages when the procedure is applied to the helsinki protocol we find that the strategic influence of a variable may drastically differ depending upon which stage is scrutinized

turning points in the civil war views from the greenback market in early 1862 the united states government began issuing greenbacks a legal tender currency that was not convertible into gold the government promised to redeem the greenbacks in gold eventually but speculators understood that the probability of redemption depended on union army military fortunes and political developments that affected the total cost of the war to serve the speculative interest in gold a market emerged for the purpose of trading greenbacks for gold dollars because the market price of a greenback reflected the public s perceptions of future war costs the movement of these prices provides unique insights into how people at the time perceived various events we use daily quotations of the gold price of greenbacks to identify a set of dates during the civil war that market participants regarded as turning points in some cases these dates coincide with events familiar from conventional historical accounts of the war in other instances however market participants reacted strongly to events that historians have not viewed as very significant this abstract was borrowed from another version of this item

effects of political institutions on air quality we empirically test existing theories on the provision of public goods in particular air quality using data on sulfur dioxide so2 concentrations from the global environment monitoring projects for 107 cities in 42 countries from 1971 to 1996 the results are as follows first we provide additional support for the claim that the degree of democracy has an independent positive effect on air quality second we find that among democracies presidential systems are more conducive to air quality than parliamentary ones third in testing competing claims about the effect of interest groups on public goods provision in democracies we establish that labor union strength contributes to lower environmental quality whereas the strength of green parties has the opposite effect

volatility and development why is gdp growth so much more volatile in poor countries than in rich ones we identify four possible reasons i poor countries specialize in more volatile sectors ii poor countries specialize in fewer sectors iii poor countries experience more frequent and more severe aggregate shocks e g from macroeconomic policy and iv poor countries macroeconomic fluctuations are more highly correlated with the shocks of the sectors they specialize in we show how to decompose volatility into these four sources quantify their contribution to aggregate volatility and study how they relate to the stage of development we document the following regularities first as countries develop their productive structure moves from more volatile to less volatile sectors second the level of specialization declines with development at early stages and slowly increases at later stages of development third the volatility of country specific macroeconomic shocks falls with development fourth the covariance between sector specific and country specific shocks does not vary systematically with the level of development we argue that many theories linking volatility and development are not consistent with these findings and suggest new directions for future theoretical work

sources of emission reductions market and policy stringency effects abstract international trade and economic development affect air emissions previous studies have decomposed their effects into scale composition and technique effects while the scale and composition effects occur through market responses the technique effect is a policy stringency influence through the mix of environmental policies this study analyzes whether the market or policy stringency effects are more prominent previous studies have been unable to adequately separate the market and policy stringency effects to independently measure the technique effect we use two indicators of policy stringency i e shadow prices of energy and industrial energy prices these policy stringency measures are treated as endogenous the effects on six types of air emissions are estimated utilizing a sector specific international panel dataset that includes newly industrialized and former transition economies the empirical results show that the major source of emissions reductions is the policy stringency effect through carbon related policies pollution offshoring to countries with weaker carbon related regulation has a minor role in the reduction of air emissions

large shocks in the volatility of the dow jones industrial average index 1928 2013 we determine the events that cause large shocks in volatility of the djia index over the period 1928 2013 using a new semi parametric test based on conditional heteroscedasticity models we find that these large shocks can be associated with particular events financial crashes elections wars monetary policies etc we show that some shocks are not identified as extraordinary movements by the investors due to their occurring during high volatility episodes especially the 1929 1934 1937 1938 and 2007 2011 periods

cross country evidence on the link between volatility and growth this paper presents empirical evidence against the standard dichotomy in macroeconomics that separates growth from the volatility of economic fluctuations in a sample of ninety two countries as well as a sample of oecd countries the authors find that countries with higher volatility have lower growth the addition of standard control variables strengthens the negative relationship the authors also find that government spending induced volatility is negatively associated with growth even after controlling for both time and country fixed effects copyright 1995 by american economic association