intrinsic motivation in public service theory and evidence from state supreme courts abstractthis paper provides a theoretical and empirical analysis of the intrinsic preferences of state appellate court judges we construct a panel data set using published decisions from all state supreme courts from 1947 to 1994 we estimate the effects of changes in judges employment conditions on a number of measures of judicial performance the results are consistent with the hypothesis that judges are intrinsically motivated to provide high quality decisions and that at the margin they prefer quality over quantity when judges face less time pressure whether from the introduction of an intermediate appellate court the weakening of electoral demands or an increased salary they write more well researched opinions that are cited more often by other judges these effects are strongest when judges have more discretion to select their portfolios of cases

the federal funds rate and the channels of monetary transmission the authors show that the interest rate on federal funds is extremely informative about future movements of real macroeconomic variables then they argue that the reason for this forecasting success is that the funds rate sensitively records shocks to the supply of bank reserves that is the funds rate is a good indicator of monetary policy actions finally using innovations to the funds rate as a measure of changes in policy the authors present evidence consistent with the view that monetary policy works at least in part through credit i e bank loans as well as through money i e bank deposits copyright 1992 by american economic association

tobacco consumption and policy in the united kingdom in recent years several structural changes and sequences of shocks have occurred in the market for tobacco in the uk including an explosive growth in smuggling this study examines whether it is still possible to estimate a reliable plausible tobacco demand equation from time series data for the uk whilst allowing for all of the various shocks and structural changes a second objective of this study is to use the estimated demand function to evaluate tobacco policy in the uk including the scope for using tax increases to achieve reduced consumption and increased revenues it is found that smuggling has diminished the revenue yield of higher rates of duty but total consumption of tobacco has been reduced in addition to the introduction of further measures to control smuggling policy may need to place more emphasis in the future on health campaigns and smoking restrictions

monetary shocks the exchange rate and the trade balance abstract this paper investigates the response of the exchange rate and the trade balance to monetary policy innovations for the us economy during the period 1973 01 1993 12 the empirical findings indicate that contractionary monetary policy shocks lead to transitory appreciations of the real and the nominal exchange rate exchange rate appreciations that are caused by a temporary contractionary shock to monetary policy are correlated with a short lived improvement in the trade balance which is then followed by a deterioration giving support to the j curve hypothesis

to elect or to appoint bias information and responsiveness of bureaucrats and politicians in this paper we address empirically the trade offs involved in choosing between bureaucrats and politicians in order to do this we map institutions of selection and retention of public officials to the type of public officials they induce we do this by specifying a collective decision making model and exploiting its equilibrium information to obtain estimates of the unobservable types we focus on criminal decisions across us states supreme courts we find that justices that are shielded from voters influence bureaucrats on average i have better information ii are more likely to change their preconceived opinions about a case and iii are more effective make less mistakes than their elected counterparts politicians we evaluate how performance would change if the courts replaced majority rule with unanimity rule

the identification of monetary policy disturbances explaining the liquidity puzzle abstract this paper examines recent work on the identification of monetary policy disturbances its main finding is that the empirical anomalies found in the literature reflect a failure to properly address the federal reserve s policy of accommodating reserve demand shocks a new method of identifying monetary policy using nonborrowed reserves is proposed using this specification policy has a strong persistent liquidity effect regardless of subsample policy granger causes output even in the presence of interest rates explaining approximately 49 of the variance in output at a two year horizon and the residual explanatory power of interest rates for output is negligible

legislative restraints in corporate bailout design abstract the aftermath of the recent economic crisis saw the largest u s government bailout of corporate entities ever while the bailout was carried out with the explicit goal of restoring stability it aroused much controversy and public criticism based on moral hazard concerns as well as the exorbitant cost to the taxpayer this paper examines the bailout design on behalf of an imperfectly informed legislature aimed at shaping the incentives of a policymaker to whom bailout decisions are delegated we show that important elements of the more moral hazard proof design entail various legislative procedural hurdles which effectively make the bailouts dependent on supermajority support

seasonality in dynamic regression models this paper examines the implications of treating seasonality as an unobserved component which changes slowly over time this approach simplifies the specification of dynamic relationships by separating non seasonal from seasonal factors we illustrate this approach using the consumption model of davidson et al 1978 and estimate a stable error correction model between consumption income and prices over the period 1958 92 more generally we argue that autoregressive models are unlikely to successfully model slowly changing seasonality and may confound seasonal effects with the dynamic responses of prime interest our approach can be used in a wide range of cases and we show that there is little loss in efficiency even if seasonality is deterministic

information polarization and term length in democracy abstract this paper considers term lengths in a representative democracy where the political issue divides the population on the left right scale parties are ideologically different and better informed about the consequences of policies than voters are a short term length makes the government more accountable but the re election incentive leads to policy distortion as the government seeks to manipulate swing voters beliefs to make its ideology more popular this creates a trade off a short term length improves accountability but gives distortions a short term length is best for swing voters when the uncertainty is large and parties are not very polarized partisan voters always prefer a long term length when politicians learn while in office a long term length becomes more attractive for swing voters

exchange rate based inflation stabilization the initial real effects of credible plans abstract this paper studies the initial effects of exchange rate based stabilization programs within a dynamic general equilibrium model of a small open economy in which inflation acts as a tax on intermediate transactions and capital accumulation is subject to convex adjustment costs and gestation lags the model replicates the typical pattern of slow inflation convergence sustained real exchange rate appreciation trade balance deterioration and expansion in domestic spending followed by a deflationary slowdown without resorting to sticky prices imperfect credibility or adaptive expectations calibrated versions of the model are compared with the initial effects of the argentine convertibility plan of april 1991

nonparametric estimation of the effects of advertising the case of lydia pinkham this article reexamines some of the issues raised subsequent to the classical research by palda 1964 we use a nonparametric estimation method that allows us to incorporate both seasonal and smoothness constraints to estimate the parameters of a demand function using monthly data on lydia pinkham s vegetable compound the analysis indicates that the parameters of the estimated demand equation are not constant throughout the long period of the data which covers the whole life cycle of the product

demand estimation in the presence of stochastic trend and seasonality the case of meat demand in the united kingdom if budget shares have stochastic trend or seasonality or both then demand equations based on the assumption of deterministic trend and deterministic seasonality will be mis specified we test this proposition by estimating a linearized almost ideal lai demand system for meat demand in the united kingdom using harvey s structural time series methodology we demonstrate that the model specification allowing for stochastic trend and deterministic seasonality performs best in terms of diagnostic tests and goodness of fit measures it is also shown that the model with stochastic trend is better at out of sample forecasting

residential electricity demand dynamics in turkey abstract this article provides fresh empirical evidences for the income and price elasticies of the residential energy demand both in the short run and long run for turkey over the period 1968 2005 using the bounds testing procedure to cointegration the computed elasticities of income and price are consistent with the previous studies and as expected the long run elasticities are greater than the short run elasticities an augmented form of granger causality analysis is implemented among residential electricity income price and urbanization in the long run causality runs interactively through the error correction term from income price and urbanization to residential energy but the short run causality tests are inconclusive the parameter stability of the short run as well as long run coefficients in the residential energy demand function are tested the results of these tests display a stable pattern

fiscal transparency political parties and debt in oecd countries abstract many believe and argue that fiscal or budgetary transparency has large positive effects on fiscal performance however the evidence linking transparency and fiscal policy outcomes is less compelling to analyze the effects of fiscal transparency on public debt accumulation we present a career concerns model with political parties this allows us to integrate as implications of a single model three hitherto separate results in the literature on deficit and debt accumulation that transparency decreases debt accumulation at least by reducing an electoral cycle in deficits that right wing governments at least for strategic reasons tend to have higher deficits than left wing governments and that increasing political polarization increases debt accumulation to test the predictions of the model we construct a replicable index of fiscal transparency on 19 country oecd data simultaneous estimates of debt and transparency strongly confirm that a higher degree of fiscal transparency is associated with lower public debt and deficits independent of controls for explanatory variables from other approaches

an asymmetric error correction model of uk consumer spending this paper augments the granger and lee journal of applied econometrics 4 1989 non symmetric error equilibrium correction model to assess the possibility that in the aggregate consumers respond differently to different types of disequilibrium error this idea is illustrated using an engle granger implementation of the davidson hendry srba and yeo dhsy economic journal 80 1978 model the disequilibrium error is endogenously determined by the long run empirical model and a binary dummy variable captures two alternative states above and below equilibrium spending interaction of the dummy variable with key variables in a short run dynamic model of uk consumer spending augments the dynamics of the dhsy model income elasticities inflation elasticities and speeds of adjustment are all seen to change significantly depending on whether the disequilibrium error is positive or negative and is suggestive of asymmetric behaviour on the part of consumers moreover the asymmetrically augmented mode

super partes assessing the effect of judicial independence on entry incumbents can enjoy a cost advantage vis a vis new entrants and so deter new firm entry by establishing and leveraging connections with the judicial system connected firms may in fact avoid fully complying with the costly norms implied by a law a regulation or a contract at the same time they can also credibly threaten to sue new entrants therefore a change in the institutional environment that diminishes the ability of incumbent firms to establish judicial connections i e an increase in judicial independence can promote entrepreneurship exploiting reforms that change the way in which u s state judges are selected we confirm that this is the case and we show that this effect is more salient in states and industries where the likelihood of entering into a business dispute is higher the paper also sheds some light on the mechanisms behind this effect data and the online appendix are available at https doi org 10 1287 mnsc 2017 2794 this paper was accepted by toby stuart entrepreneurship

estimation of residential electricity demand in hong kong under electricity charge subsidies abstract over the past decade the hong kong hk government provided electricity charges subsidies for residential accounts to alleviate the burden of inflation and later the burden of economic downturn in this study we estimate an econometric model of residential electricity demand and test the existence of a stable long run relationship for the period 1980 2016 while accounting for the relief measures set out by the hk government since 2008 empirical results suggest that there exists a long run relationship among residential electricity consumption electricity price income per capita and weather variables temperature or cooling degree days in the absence of electricity charge subsidies the demand is found to be both price and income inelastic on the other hand hk s residential electricity consumers are unresponsive to price and income changes when electricity subsidies are in place following its new carbon reduction plan hk is gradually phasing out coal for electricity generation to replace it mainly with natural gas our results suggest that new residential electricity charge subsidies can lessen the effectiveness of6 climate policies aimed at reducing electricity consumption through increases in the electricity price

modelling the trend and seasonality in the consumption of alcoholic beverages in the united kingdom a univariate time series analysis of the consumption of beer wine and spirits in the uk over the period 1964 1995 is presented the analysis shows that the consumption of beer and wine exhibits stochastic seasonality while the consumption of spirits exhibits deterministic seasonality moreover the three series are found to have stochastic trends analysis of the out of sample forecasting power of the various models reveals that the model with stochastic trend and seasonality is superior to other models the results cast doubt on the validity and soundness of the practice of modelling the consumption of alcoholic beverages by assuming deterministic trend and seasonality

modelling residential electricity demand in the gcc countries abstract this paper aims at understanding the drivers of residential electricity demand in the gulf cooperation council countries by applying the structural time series model in addition to the economic variables of gdp and real electricity prices the model accounts for population weather and a stochastic underlying energy demand trend as a proxy for efficiency and human behaviour the resulting income and price elasticities are informative for policy makers given the paucity of previous estimates for a region with particular political structures and economies subject to large shocks in particular the estimates allow for a sound assessment of the impact of energy related policies suggesting that if policy makers in the region wish to curtail future residential electricity consumption they would need to improve the efficiency of appliances and increase energy using awareness of consumers possibly by education and marketing campaigns moreover even if prices were raised the impact on curbing residential electricity growth in the region is likely to be very small given the low estimated price elasticities unless that is prices were raised so high that expenditure on electricity becomes such a large proportion of income that the price elasticities increase in absolute terms

reinterpreting the dhsy 1978 consumption function with hindsight the justification for davidson hendry srba and yeo s dhsy s selection of their favoured equation is shown to be based upon contradicting assumptions about inflation the empirically supported model is argued not to have a theoretically justified error correction interpretation the exclusion of the intercept biases the error correction term such that it becomes significant and negative but undermines the theoretical plausibility of the long run target more generally the statistical need to include an intercept in any regression to avoid parameter bias is demonstrated the rise in inflation in the 1970s is not considered to be a credible explanation of the fall in the average propensity to consume apc from the 1950s and is shown to have questionable empirical support when a below unit income elasticity is allowed for the recent articles which have found support for dhsy s favoured formulation augmented by time varying parameters using the most contemporary uk data should be viewed with caution new interpretations for the dhsy model s persistent success are called for if it is not to be considered that dubious regressions have been resurrected

a positive theory of fiscal deficits and government debt this paper considers an economy in which policymakers with different preferences alternate in office as a result of elections government debt is used strategically by each policymaker to influence the choices of his successors if different policymakers disagree about the desired composition of government spending between two public goods the economy exhibits a deficits bias that is debt accumulation is higher than it would be with a social planner the equilibrium level of debt is larger the larger is the degree of polarization between alternating governments and the less likely it is that the current government will be re elected

deterministic and stochastic trends in the time series models a guide for the applied economist applied economists working with time series data face a dilemma in selecting between models with deterministic and stochastic trends while models with deterministic trends are widely used models with stochastic trends are not so well known in an influential paper harvey 1997 strongly advocates a structural time series approach with stochastic trends in place of the widely used autoregressive models based on unit root tests and cointegration techniques therefore it is important to understand their relative merits this article suggests that both methodologies are useful and they may perform differently in different models this article provides a few guidelines to the applied economists to understand these alternative methods

modeling household energy expenditure in the united states abstract energy consumption is one of the main source of air pollution greenhouse gas emission and global warming reducing household energy consumption is a key goal of policymakers we develop statistical models using socio economics and demographics building characteristics location temperature and energy prices to estimate household energy expenditure in the u s we use household energy expenditure for more than 560 000 households in the u s from 2010 to 2012 we first employ multivariate regression models to investigate and identify the impacts of the explanatory variables on household energy expenditure next we use principal component analysis pca to convert correlated co linear explanatory variables into orthogonal components and estimate household energy expenditure by principal component regression we find newer attached buildings to be effective in decreasing household energy expenditure particularly among educated people in metropolitan areas with sufficient data availability our model could be used by state regional or even city level policymakers and planners to optimize their infrastructural investments

understanding the spectrum of residential energy saving behaviours french evidence using disaggregated data analysing household energy saving behaviours is crucial to improve energy consumption predictions and energy policy making how should we quantitatively measure them what are their determinants this study explores the main factors influencing residential energy saving behaviours based on a bottom up multivariate statistical approach using data from the recent french phebus survey firstly we assess energy saving behaviours on a one dimension scale using irt secondly we use linear regression with an innovative variable selection method via adaptive lasso to tease out the effects of both macro and micro factors on the behavioural score the results highlight the impact of five main attributes incentivizing energy saving behaviours based on cross variable analyses energy price household income education level age of head of household and dwelling energy performance in addition our results suggest that the analysis of the inverted u shape impact of age enables the expansion of the energy consumption life cycle theory to energy saving behaviours abstract analysing household energy saving behaviours is crucial to improve energy consumption predictions and energy policy making how should we quantitatively measure them what are their determi nants this study explores the main factors influencing residential energy saving behaviours based on a bottom up multivariate statistical approach using data from the recent french phebus survey firstly we assess energy saving behaviours on a one dimension scale using irt secondly we use linear regression with an innovative variable selection method via adaptive lasso to tease out the effects of both macro and micro factors on the behavioural score the results highlight the impact of five main attributes incentivizing energy saving behaviours based on cross variable analyses energy price household income education level age of head of household and dwelling energy performance in addition our results suggest that the analysis of the inverted u shape impact of age enables the expansion of the energy consumption life cycle theory to energy saving behaviours

civil service reform abstract civil service rules governing the selection and motivation of bureaucrats are among the defining institutions of modern democracies although this is an active area of reform in the us and elsewhere economic analyses of the issue are virtually nonexistent this paper provides a welfare evaluation of civil service reform it describes the effect of reform on the interaction of politicians voters and bureaucrats and shows that society often faces trade offs between improving the bureaucracy and improving the performance of politicians my results characterize the conditions under which merit based recruitment and civil service protections such as tenure can improve welfare

incumbent performance and electoral control in the pure theory of electoral competition citizens compare the platforms of the candidates and vote for the one whose platform is preferred candidate strategies are identified with promises about future performance in office models of this sort have been developed in both static mckelvey 1975 and dynamic kramer 1977 i settings and all appear to have the property that if the set of alternatives is large enough in some sense equilibrium platforms rarely exist but these models have another feature that is quite as disturbing as their instability in the static setting discussed by mckelvey little attention is paid to the possibility that once in office the politician s preferences may diverge from those of his constituents and that he may therefore choose policies at variance from his platform instead it is simply assumed that promises will be kept whether or not such behavior is congruent with the interest of the officeholder it is sometimes argued that an enforcement mechanism may exist to discipline politicians for failing to keep promises but without a specification of the mechanism it is not obvious that it would be in the interests of the

preferences and incentives of appointed and elected public officials evidence from state trial court judges we study how two selection systems for public officials appointment and election affect policy outcomes focusing on state court judges and their criminal sentencing decisions first under appointment policy congruence with voter preferences is attained through selecting judges with homogeneous preferences in contrast under election judges face strong reelection incentives while selection on preferences is weak second the effectiveness of election in attaining policy congruence critically depends on payoffs from the job which implies that the effectiveness of election may vary substantially across public offices third reelection incentives may discourage judges with significant human capital from holding office jel d72 k41 understanding systems concerning the selection and retention of public officials and their effects on policy outcomes has long been an important issue in economics e g barro 1973 and ferejohn 1986 in this paper we compare two selection systems for public officials appointment by the head of the executive branch and election by popular votes we study the influence of the selection systems on public officials behavior focusing on state court judges and their criminal sentencing decisions specifically we quantitatively assess the separate role of preference heterogeneity versus reelection incentives in determining sentencing decisions we focus on the behavior of state court judges in the state of kansas which has within state variation in the selection systems 1 we conduct three key analyses

why a stubborn conservative would run a deficit policy with time inconsistent preferences a conservative government in favor of a low level of public consumption knows that it will be replaced by a government in favor of a larger level of public consumption we show that the resulting level of public consumption is in between the levels the two governments would choose if each were in power both in the present and in the future in particular we show that if the conservative government is more stubborn in a particular sense than the succeeding government the conservative government will borrow more than it would had it remained in power in the future

a review of the decomposition methodology for extracting and identifying the fluctuation characteristics in electricity demand forecasting abstract electricity consumption data is regarded as nonlinear non stationary series and is often made up by a superposition of several distinct frequencies thus most of the conventional approaches currently employed for the modeling and forecasting involve great complexity and uncertainty recently fluctuation characteristic analysis has increasingly become essential step in the application of electricity demand forecasting yet the implementation of this analysis is an inherently difficult task to obtain reasonable accuracy and stability in the modeling there has been the tendency to accommodate multidimensional attributes of the consumption demands with decomposition based approach in terms of more advanced and hybrid form and the decomposition can be achieved through utilization of two different procedures namely component model based and frequency domain analysis based decomposition consequently a comprehensive review and summarization of decomposition based approach for the prediction is conducted in this paper more specifically the issues of demand forecasting classification the dependency between the electricity demand and external indicators features of various decomposition approach as well as the unique fluctuation characteristic of electricity demand at different time scales are discussed in addition future research directions of the decomposition based prediction approach are outlined

a review of time use models of residential electricity demand residential electricity demand in most european countries accounts for a major proportion of overall electricity consumption the timing of residential electricity demand has significant impacts on carbon emissions and system costs this paper reviews the data and methods used in time use studies in the context of residential electricity demand modelling it highlights key issues which are likely to become more topical for research on the timing of electricity demand following the roll out of smart metres

incorporating life cycle external cost in optimization of the electricity generation mix the present work aims to examine the strategic decision of future electricity generation mix considering together with all other factors the effect of the external cost associated with the available power generation technology options not only during their operation but also during their whole life cycle the analysis has been performed by integrating the life cycle assessment concept into a linear programming model for the yearly decisions on which option should be used to minimize the electricity generation cost the model has been applied for the case of greece for the years 2012 2050 and has led to several interesting results firstly most of the new generating capacity should be renewable mostly biomass and wind while natural gas is usually the only conventional fuel technology chosen if externalities are considered wind energy increases its share and hydro power replaces significant amounts of biomass generated energy furthermore a sensitivity analysis has been performed one of the most important findings is that natural gas increases its contribution when externalities are increased summing up external cost has been found to be a significant percentage of the total electricity generation cost for some energy sources therefore significantly changing the ranking order of cost competitiveness for the energy sources examined

the price of owning a car an analysis of auction quota premium in singapore faced with dilemmas parallel to countries besieged by road congestions and limited land resources singapore has chosen to adapt a vehicle quota system vqs whereby car owners are required to bid for a licence in an auction before their vehicles are allowed onto the road in this study the behaviour of vqs auction prices is examined using a structural time series approach for outliers that are not observable from innovations auxiliary residuals with dummy variables are used to supplement the analysis in general prices exhibit a fairly constant seasonal pattern the inclusion of monthly vqs quotas released by the transport regulatory body and the national stock market index is not useful in explaining the observed price behaviour interestingly a basic structural model with stochastic components seems to fit the data best

exchange rate versus monetary aggregate targeting the turkish case this article compares and contrasts the macroeconomic effects of exchange rate targeting and money supply targeting by using quarterly data from turkey for the period february 1986 march 2000 the results of the var analysis show that the exchange rate does not have the traditional hump shaped effect that money supply has on output in addition we observe that an exchange rate depreciation leads to a temporary improvement in the trade balance for only a year while monetary innovations have longer lasting effects those results suggest that money based targeting is more appropriate than exchange rate targeting for turkey

recent advances in modelling seasonality abstract in this paper we review recent developments in econometric modelling of economic time series with seasonality the prime focus is on econometric models which incorporate explicit descriptions of seasonal variation instead of removing this variation using a seasonal adjustment method this review centres around developments in seasonal unit root models and in periodic parameter models both in the univariate and multivariate context several empirical examples are used for illustration we also discuss several areas for further research

the causality between energy consumption and economic growth in turkey abstract this paper applies the causality test to examine the causal relationship between primary energy consumption ec and real gross national product gnp for turkey during 1970 2006 we employ unit root tests the augmented dickey fuller adf and the philips perron pp johansen cointegration test and pair wise granger causality test to examine relation between ec and gnp our empirical results indicate that the two series are found to be non stationary however first differences of these series lead to stationarity further the results indicate that ec and gnp are cointegrated and there is bidirectional causality running from ec to gnp and vice versa this means that an increase in ec directly affects economic growth and that economic growth also stimulates further ec this bidirectional causality relationship between ec and gnp determined for turkey at 1970 2006 period is in accordance with the ones in literature reported for similar countries consequently we conclude that energy is a limiting factor to economic growth in turkey and hence shocks to energy supply will have a negative impact on economic growth

seasonality stock returns and the macroeconomy this paper examines the relationship between seasonality stock returns and the macroeconomy using a multifactor model of stocks returns observed seasonal patterns in excess returns are found to be a result of seasonality in excess expected returns by utilising a multifactor model of stock returns these higher returns are found to be a compensation for risk associated with a number of macroeconomic factors at certain times of the year

estimation of elasticities for electricity demand in brazilian households and policy implications abstract this paper aims to identify the demand elasticity in energy consumption by brazilian families by using an original household level sample we are the first to identify the average price and income elasticities for brazil we also investigate heterogeneous effects across different quantiles through a quantile regression qr analysis finally we extend the results of the qr analysis and combine them with aggregated data to assess the effects of two price policies a cross subsidy and the recently adopted tariff flags the primary data comes from the household budget survey pof for two periods 1998 99 and 2008 13 conducted in the metropolitan area of sao paulo the price and income elasticities range from 0 46 to 0 56 and from 0 20 to 0 32 respectively the qr results indicate that households behavioral response to a price increase is non uniform across groups and that the reaction is stronger for the lower quantiles additionally tariff flags lead to a more significant reduction in consumption for the low income residences therefore representing a regressive policy on the other hand a cross subsidy that increases the energy price to ordinary residences by 1 could mean a decrease in electricity prices of between 7 5 and 12 4 to low income families

court politics the political economy of tort awards abstract we investigate the forces that explain why trial awards differ across the united states in 23 states judges are elected and in 10 they are elected via partisan elections elections have two important effects first defendants are often out of state nonvoters while plaintiffs are typically in state voters we predict therefore that elected judges will redistribute wealth from out of state businesses to in state plaintiffs second the realities of campaign financing require judges to seek and accept campaign funding from trial lawyers who uniformly are interested in larger awards we hypothesize that these two forces cause awards to be larger in states where the judiciary is elected rather than appointed we also hypothesize that the demand for redistribution will increase as poverty increases and thus that awards will be larger in states with greater poverty using a sample of over 7 000 cases across 48 of the 50 states we find significant evidence in support of these hypotheses

modelling and forecasting turkish residential electricity demand abstract this research investigates the relationship between turkish residential electricity consumption household total final consumption expenditure and residential electricity prices by applying the structural time series model to annual data over the period from 1960 to 2008 household total final consumption expenditure real energy prices and an underlying energy demand trend are found to be important drivers of turkish residential electricity demand with the estimated short run and the long run total final consumption expenditure elasticities being 0 38 and 1 57 respectively and the estimated short run and long run price elasticities being 0 09 and 0 38 respectively moreover the estimated underlying energy demand trend which as far as is known has not been investigated before for the turkish residential sector should be of some benefit to turkish decision makers in terms of energy planning it provides information about the impact of past policies the influence of technical progress the impacts of changes in consumer behaviour and the effects of changes in economic structure furthermore based on the estimated equation and different forecast assumptions it is predicted that turkish residential electricity demand will be somewhere between 48 and 80 twh by 2020 compared to 40 twh in 2008

the disadvantage of tying their hands on the political economy of policy commitments incumbents are more likely to be re elected if they have a comparative advantage in the eyes of voters on some central issue this paper argues that incumbents have an incentive to avoid reforms that reduce the government s role in deciding these issues in order to increase their chances of re election this point is illustrated in the context of the choice of an exchange rate regime in an economy characterized by an inflation bias a flexible exchange rate allows the government to use monetary policy as a stabilization tool while fixed exchange rates remove the inflation bias of the economy on the one hand it is shown that a more inflation averse government may refrain from choosing fixed exchange rates in order to capitalize on the inflationary reputation of its opponent this incentive is contrasted with the opposite incentive to tie the hands of the future government should be incumbent be defeated on the other hand it is shown that electoral considerations may reinforce the incentive of the more inflationary government to tie its own hands with fixed exchange rates

estimation of urban residential electricity demand in china using household survey data abstract this paper uses annual urban household survey data of sichuan province from 2007 to 2009 to estimate the income and price elasticities of residential electricity demand along with the effects of lifestyle related variables the empirical results show that in the urban area of sichuan province the residential electricity demand is price and income inelastic with price and income elasticities ranging from 0 35 to 0 50 and from 0 14 to 0 33 respectively such lifestyle related variables as demographic variables dwelling size and holdings of home appliances are also important determinants of residential electricity demand especially the latter these results are robust to a variety of sensitivity tests the research findings imply that urban residential electricity demand continues to increase with the growth of income the empirical results have important policy implications for the multistep electricity price which been adopted in some cities and is expected to be promoted nationwide through the installation of energy efficient home appliances

diagnostic checking of unobserved components time series models diagnostic checking of the specification of time series models is normally carried out using the innovations that is the one step ahead prediction errors in an unobserved components model other sets of residuals are available these auxiliary residuals are estimators of the disturbances associated with the unobserved components they can often yield information that is less apparent from the innovations but they suffer from the disadvantage that they are serially correlated even in a correctly specified model with known parameters this article shows how the properties of the auxiliary residuals may be obtained how they are related to each other and to the innovations and how they can be used to construct test statistics applications are presented showing how residuals can be used to detect and distinguish between outliers and structural change

household consumption of electricity in brazil between 1985 and 2013 abstract this article describes the electricity consumption in brazilian residences between 1985 and 2013 through linear regressions the explanatory variables considered were the number of households effective consumption of families as a proxy for family income and electricity tariff for households to deal with the power generation crisis of 2001 we have introduced a dummy variable in the form of a step function with such explanatory variables we were able to account for the reduction of household electricity consumption caused by the policies conducted in 2001 and their permanent consequences the regression presented coefficient of determination of 0 9892 and the several statistic tests conducted assured the existence of long term relation between the electricity consumption in residences and the explanatory variables the obtained elasticities for the household consumption of electricity with respect to number of residences family income and residential tariff of electricity were 1 534 0 095 0 189 0 049 and 0 230 0 060 respectively these results allowed understanding the evolution over time of the household consumption of electricity in brazil they suggest that the electric sector in brazil should pursue an active policy to manage demand of residential electricity using tariffs as a means to control it

underlying trends and seasonality in uk energy demand a sectoral analysis this paper demonstrates the importance for energy demand modelling of allowing for trends and seasonal effects that are stochastic in form inherent underlying trends may be non linear and reflect not only technical progress which usually produces greater energy efficiency but also other factors such as changes in consumer tastes and the economic structure that may be working in the opposite direction using quarterly unadjusted data for various sectors in the uk it is shown that unless energy demand models are formulated so as to allow for stochastic trends and seasonals estimates of price and income elasticities could be seriously biased

electoral competition in the american states electoral competition is a concept that has played a central role in much of the state politics literature one commonly used indicator of competition in the states is the ranney index we offer an alternative indicator of competition one based on district level outcomes of state legislative elections after evaluating both indicators in terms of validity and reliability the analysis suggests that the district level indicator is both empirically and intuitively superior as a measure of electoral competition the implications of this finding are discussed

sources of inefficiency in a representative democracy a dynamic analysis this paper studies the efficiency of policy choice in representative democracies it extends the citizen candidate model of democratic policy making to a dynamic environment equilibrium policy choices are shown to be efficient in the sense that in each period conditional on future policies being selected through the democratic process there exists no alternative current policy choices which can raise the expected utilities of all citizens however policies that would be declared efficient by standard economic criteria are not necessarily adopted in political equilibrium the paper argues that these divergencies are legitimately viewed as politicalfailures

the origins of democracy a model with application to ancient greece abstract this paper seeks to provide an improved understanding of the origins of democracy it begins by developing a theoretical model to demonstrate how exogenous economic conditions can influence the incentives to establish democratic institutions the model predicts that democratic institutions will expand where they mitigate important time inconsistency problems and therefore encourage investment exogenous conditions determine the magnitude of those time inconsistency problems and hence the likelihood of democracy a comparison of ancient greek city states suggests that the conditions under which democracy first emerged support the model other potential applications are discussed

is there a politically optimal level of judicial independence independent courts render current policy more durable by raising the cost of future policy changes but may also engage in policy making of their own this paper asks is there an optimal level of judicial independence from the perspective of incumbent officials in the other branches to answer that question the paper develops a model of strategic institutional choice and tests it on the judicial institutions of the american states consistent with the model s predictions the most independenceenhancing institutions are found where political competition between rival parties is tightest and differences between party platforms are largest

equity market valuation systematic risk and monetary policy this study examines the relationship between equity market valuation and risk indicators that portend economic downswings the indicators are implied options volatility treasury eurodollar ted spread and exchange rate while implied volatility captures market risk in that it reflects the fear factor embedded in the price of an option ted spread reflects the default risk premium that is priced into a key short term credit instrument equity markets often show a tendency to reflect the incidence of these risk factors and because they provide valuable information about the health of the economy many have argued that equity market valuation be taken into account in the formulation of monetary policy results of this study not only show a statistically significant inverse relationship between the stock market and these risk factors but also evidence of a cointegration in a variance decomposition of the series we find that equity valuation is a major contributor to the forecast error variances of each

forecasting aggregate consumers expenditure in the u k using the dhsy model the performance of the dhsy model in predicting the growth of aggregate consumers expenditure in the uk over the period 1985 1988 is examined the model is applied to four different combinations of consumption variable and data type results show in all cases the predictive performance of the dhsy model to be poor however applied to seasonally adjusted data an improvement can be achieved by allowing for systematic variation in coefficients in particular a variable coefficient dhsy model displays no tendency to underpredict the growth of total consumers expenditure and accurately captures the volatility of non durable expenditure

asymmetry in okun s law in this paper we support the proposition that the output unemployment relationship as represented by okun s law is asymmetric okun s coefficients are defined based on a dynamic model that allows for asymmetry in the relationship between cyclical output and unemployment using data from the united states for the post war period our results show that the short run effects of positive cyclical output on cyclical unemployment are quantitatively different from those of negative ones and the data are consistent with the proposition that cyclical unemployment is more sensitive to negative than to positive cyclical output several theoretical

industrial electricity demand for turkey a structural time series analysis abstract this research investigates the relationship between turkish industrial electricity consumption industrial value added and electricity prices in order to forecast future turkish industrial electricity demand to achieve this an industrial electricity demand function for turkey is estimated by applying the structural time series technique to annual data over the period 1960 to 2008 in addition to identifying the size and significance of the price and industrial value added output elasticities this technique also uncovers the electricity underlying energy demand trend uedt for the turkish industrial sector and is as far as is known the first attempt to do this the results suggest that output and real electricity prices and a uedt all have an important role to play in driving turkish industrial electricity demand consequently they should all be incorporated when modelling turkish industrial electricity demand and the estimated uedt should arguably be considered in future energy policy decisions concerning the turkish electricity industry the output and price elasticities are estimated to be 0 15 and 0 16 respectively with an increasing but at a decreasing rate uedt and based on the estimated equation and different forecast assumptions it is predicted that turkish industrial electricity demand will be somewhere between 97 and 148 twh by 2020

energy consumption and economic activity in industrialized countries the dynamic aggregate time series relationship abstract most econometric studies suggest that the income elasticity of demand for energy is approximately unity for the developed market economies it is shown that over the period 1950 1978 the long run income elasticity is substantially higher than unity in terms of a ces energy demand function this result reflects the application of a generalized dynamic estimation methodology where serial correlation is regarded as a diagnostic guide to distributed lag fitting price elasticities are also estimated but these are in line with conventional estimates

arima forecasting of primary energy demand by fuel in turkey abstract forecasting of energy demand in emerging markets is one of the most important policy tools used by the decision makers all over the world in turkey most of the early studies used include various forms of econometric modeling however since the estimated economic and demographic parameters usually deviate from the realizations time series forecasting appears to give better results in this study we used the autoregressive integrated moving average arima and seasonal arima sarima methods to estimate the future primary energy demand of turkey from 2005 to 2020 the arima forecasting of the total primary energy demand appears to be more reliable than the summation of the individual forecasts the results have shown that the average annual growth rates of individual energy sources and total primary energy will decrease in all cases except wood and animal plant remains which will have negative growth rates the decrease in the rate of energy demand may be interpreted that the energy intensity peak will be achieved in the coming decades another interpretation is that any decrease in energy demand will slow down the economic growth during the forecasted period rates of changes and reserves in the fossil fuels indicate that inter fuel substitution should be made leading to a best mix of the country s energy system based on our findings we proposed some policy recommendations

nominal interest rates consumption booms and lack of credibility a quantitative examination abstract exchange rate based stabilization programs in chronic inflation countries have often been accompanied by an initial expansion of private consumption followed by a contraction this consumption cycle has been attributed to lack of credibility in the sense that the public views the reduction in the devaluation rate as temporary this paper assesses the quantitative relevance of the temporariness hypothesis by comparing the predictions of a simple model to the actual figures for seven major programs the paper concludes that nominal interest rates must fall substantially for the temporariness hypothesis to account for an important fraction of the observed consumption booms

voting on the budget deficit this paper analyzes a model in which a group of rational individuals votes over the composition and time profile of public spending all voters agree that a balanced budget is ex ante optimal however if there is disagreement between current and future majorities a balanced budget is not a political equilibrium under majority rule under certain conditions a majority of the voters favors a budget deficit and the equilibrium deficit is larger the greater is the polarization among voters copyright 1990 by american economic association

measuring exchange rate misalignment in turkey we propose a new methodology to measure exchange rate misalignment for turkey which has already undergone a severe economic crisis we estimate the real exchange rate within a time varying parameter model where a return to normality assumption about the parameters are assumed contrary to common belief it is found that except the initial four months of the stabilization program the turkish lira remained structurally undervalued for most of 2000 also we observe a pattern where lira has been structurally overvalued after the crisis in 1994 until 1998 and has displayed structural undervaluation after then

econometrics and business cycle empirics business cycle empirics have long been a central arena for the debate about the roles of economic theory and econometrics in modelling economic time series data some famous historical examples are moore i9i4 keynes i939 and koopmans i947 sources for potential disagreements include that the entire economic system is involved and unobservable stochastic forces seem more than usually prominent in determining the outcome not only do these constitute two aspects about which it is hard to theorise they are equally difficult to model empirically there are both positive arguments for and negative arguments against according a dominant role to either theory or evidence not least because it is unclear what constitutes admissible instances of either in the absence of the other we first review what precludes a purely theoretical approach what prevents a purely empirical approach and hence why an interactive approach is imperative even so both the relative importance of the two ingredients and their substantive contents are likely to remain at issue first concerning the economy considerable empirical evidence suggests that it is a dynamic non linear high dimensional and evolving entity so studying it is difficult society and social systems alter over time laws change and technological innovations occur so establishing any invariants of an economic system is not easy such difficulties adversely afflict both theory and empirical modelling secondly concerning the observations time series data in economics are heterogeneous non stationary time dependent and interdependent so it is difficult to acquire knowledge from the available empirical information again such factors also make it hard to theorise about the properties of the underlying system a more direct critique of the empirical enterprise is that samples are short and highly aggregated economic magnitudes are inaccurately measured are subject to considerable revision and important variables are not measured or are unobservable so inferences are both imprecise and tentative combined with the simultaneity non constancy and high dimensionality of economic data a purely empirical approach seems to many to be precluded other criticisms of econometric approaches include worries about data mining pretest biases a lack of genuine identifiability and collinearity sometimes combined with a belief that theory can compensate an overemphasis on a

monetary transmission mechanism in turkey under the monetary conditions index an alternative policy rule this study analyses monetary transmission mechanism in turkey using a small structural macroeconomic model the core equations of the model consist of aggregate demand wage price setting uncovered interest rate parity foreign sector and a monetary policy rule the aim of the paper is to analyse the disinflation path the output gap the output level the exchange rate and the interest rate and also the output inflation variance frontier of the economy under various scenarios the first scenario assumes that a standard taylor rule is implemented as the policy rule in the alternative scenario instead of the standard taylor rule the mci monetary conditions index combination of the changes in the short term real interest rate and in the real effective exchange rate in a single variable is used as a policy instrument the results indicate that the economy stabilizes much more quickly and shows significantly less volatility under this new setting therefore the paper concludes that the policymakers

who did worse a comparison of us and british non white unemployment 1970 1998 us and british unemployment rates for non white males and females are compared over the period 1970 1998 whereas us rates remained fairly steady there was a marked increase in british non white unemployment rates the reasons for this poor performance relative to the good performance of us non whites are explored it is shown that non white unemployment behaves in di erent ways across the two countries for example british rates rise faster in a recession than white rates whereas us rates appear not to follow this british hypercyclical pattern

the uk consumption function and structural instability improving forecasting performance using a time varying parameter approach previous studies indicate that the poor forecasting performance of constant parameter uk consumption expenditure models is caused by structural instability in the underlying data generating process typically this instability is removed by reparameterization within the constant parameter framework an alternative modelling strategy is to allow some or all of the parameters to vary over time a uk non durable consumption expenditure model with time varying parameters is developed based on the permanent income hypothesis of friedman 1957 this model takes into account temporal changes in the average and marginal propensities to consume the variation in the parameter estimates is given an economic interpretation in terms of the influence of omitted variables namely uk financial liberalization and expectational changes the forecasting performance of this model is superior to that of two widely used constant parameter models further tests show that even if these constant parameter models are respeci

energy consumption and gdp in turkey is there a co integration relationship energy consumption and gdp are expected to grow by 5 9 and 7 annually until 2025 in turkey this paper tries to unfold the linkage between energy consumption and gdp by undertaking a co integration analysis for turkey with annual data over the period 1970 2003 the analysis shows that energy consumption and gdp are co integrated this means that there is a possibly bi directional causality relationship between the two we establish that there is a unidirectional causality running from gdp to energy consumption indicating that energy saving would not harm economic growth in turkey in addition we find that energy consumption keeps on growing as long as the economy grows in turkey

industrial and residential electricity demand dynamics in japan how did price and income elasticities evolve from 1989 to 2014 abstract this study estimates the price and income elasticities of industrial and residential electricity demand in japan with the annual data from 1989 to 2014 a time varying parameter tvp model with the kalman filter is applied to monitor the evolution of consumer behaviors in the post bubble period given the exogenous shock financial crisis in 2008 and the structural breaks electricity deregulation and fukushima daiichi crisis the tvp model can provide a robust estimation of elasticities and can detect the outliers and the structural breaks the results suggest that both industrial and residential consumers become less sensitive to price after the electricity deregulation and the financial crisis and more sensitive to price after the fukushima daiichi crisis especially the industrial sector is less sensitive to price after the retail deregulation by contrast the income elasticities of industrial and residential sector consumers are stable during the examined period results also indicate that a negative relationship exists between the price elasticity of electricity demand and the price level of electricity after the electric sector deregulation some insights on the further electric sector reform and the environmental taxation in japan are also provided