forecasting the adoption of residential ductless heat pumps energy efficient technologies have the potential to provide savings to households and utilities but consumers do not always adopt these innovations over traditional technologies the ductless heat pump dhp is one such technology designed to increase energy efficiency and comfort in space conditioning dhp adoption by single family residences in the pacific northwest of the united states is investigated by quantifying the effects of utility provided rebates and expenditures on activities such as advertising and installer training on the number of installations and forecasting installations through 2018 the number of installations is elastic with respect to net installation costs and inelastic with respect to expenditures given the proposed rebate budgets doubling the current rebate is necessary to maximize installations through 2018

the role of feelings in investor decision making abstract this paper surveys the research on the influence of investor feelings on equity pricing and also develops a theoretical basis with which to understand the emerging findings of this area the theoretical basis is developed with reference to research in the fields of economic psychology and decision making recent advancements in understanding how feelings affect the general decision making of individuals especially under conditions of risk and uncertainty e g loewenstein et al 2001 psychological bulletin 127 267 286 are covered by the review the theoretical basis is applied to analyze the existing research on investor feelings e g kamstra et al 2000 american economic review forthcoming hirshleifer and shumway 2003 journal of finance 58 3 1009 1032 this research can be broadly described as investigating whether variations in feelings that are widely experienced by people influence investor decision making and consequently lead to predictable patterns in equity pricing the paper concludes by suggesting a number of directions for future empirical and theoretical research

government spending the balance of trade and the terms of trade in british history abstract this paper investigates the relationship between government spending the balance of trade and the terms of trade using early british data a large open economy intertemporal framework in which ricardian equivalence holds predicts a larger effect of temporary government spending changes on the trade deficit than permanent ones further a pure switch between debt and taxes should have no effect on trade flows the results provide some support for these hypotheses although they are sensitive to sample period and the method of decomposition of government spending a negative relationship between government spending and the terms of trade is also found

on the determination of the external debt the case of israel abstract this paper pursues the econometric implementation of an intertemporal optimization model of the foreign debt with israeli data in this model the private sector faces perfect capital markets and maximizes utility from consumption over an infinite horizon the intertemporal budget constraint recognizes the intertemporal finance equation of the government under these conditions the effect of current disturbances in output government spending and unilateral transfers on private consumption and foreign borrowing is determined by their perceived future persistence the model passes a formal econometric test however some results are also suggestive of omitted considerations

energy demand in ghana a disaggregated analysis this paper presents a comprehensive analysis of energy demand in ghana by estimating demand functions for key disaggregated energy components including gasoline diesel liquefied petroleum gas lpg kerosene biomass residual fuel oil rfo and electricity our results show that energy prices income urbanization and economic structure are significant demand drivers of the different energy types in ghana with varying estimated elasticities further there is evidence of high degree of inter fuel substitution in energy demand in ghana particularly from gasoline diesel and kerosene towards lpg consumption we recommend among different policy options a customization of energy price subsidization policies especially on lpg to reduce the unintended beneficiary dilemma or spillover effect of current government policy other policies such as intensification of energy conservation programs and market entry of independent power trading companies to enhance energy service delivery through competition are also discussed

on the substitutability between private consumer expenditure and government spending in canada the purpose of this paper is twofold first to examine whether there is any substitutability between private consumer expendit ure and government spending in canada second to test the ricardian equivalence principle both hypotheses are nested within the life cyc le rational expectations model the results indicate that the joint h ypothesis of rational expectations and ricardian equivalence can not be rejected by the data moreover they suggest that government spend ing substitutes poorly for private consumer expenditure these result s imply that temporary increases in government spending will result i n an expansion of real output

labor hoarding superior information and business cycle dynamics abstract in this paper we test whether a labor hoarding environment with basic and augmented laws of motion provide an adequate explanation for observed business cycle dynamics the basic law of motion assumes that the information set used by economic agents to forecast future forcing variables includes only the history of forcing variables augmented laws of motion assume that the information set is superior and include both forcing and hidden exogenous variables we show that the labor hoarding environment with the basic law of motion fails to replicate observed business cycle facts while the environment with augmented laws of motion successfully matches these facts

direct tests of the reservation wage property this paper provides the first direct experimental tests of the reservation wages predicted by finite horizon job search models previous indirect tests were based on search duration and search income the authors show that such indirect tests are weak by demonstrating that a naive rule performs essentially as well as the risk neutral model in predicting search duration in contrast direct tests of predicted reservation wages imply rejections of both the naive rule and the risk neutral model the general concave model survives direct tests with reservation wage data as does a specific logistic concave model copyright 1992 by royal economic society

aggregate employment real business cycles and superior information abstract we test whether dynamic stochastic general equilibrium artificial economies associated with several labor market structures provide an adequate characterization of aggregate employment volatility and dynamics our test is robust to possible misspecifications about the information set used by economic agents to forecast future events accounting for agents superior information we find that the divisible labor indivisible labor labor adjustment costs and labor hoarding structures replicate employment volatility in contrast to the nominal wage contracts structure also the labor hoarding structure provides a substantially better account of employment dynamics

a biophysical analysis of the energy real gdp ratio implications for substitution and technical change abstract this paper quantifies the factors that caused the energy real gdp ratio to change during the post war period in france the federal republic of germany japan and the united kingdom econometric results indicate that changes in the types of fuel used changes in the energy consumed by the household sector changes in the types of goods and services produced and changes in energy prices account for most of the variation in this ratio price elasticities estimated from these results are lower than those estimated by neoclassical economists and indicate that the system boundaries used by neoclassical economists overestimate the amount of energy saved by substitution analysis of the error term from the regression results indicates that energy saving technical change has had little effect on the amount of energy used to support economic activity

present value tests of an intertemporal model of the current account abstract this paper first demonstrates that in a simple intertemporal open economy model the current account is equal to the expected decline of the present discounted value of net output of a country net output is defined as gross domestic product less the sum of investment plus government spending it then uses econometric methods for present value models to analyze the current account for four countries in two of these countries the model does a satisfactory job of explaining the current account

the ricardian equivalence hypothesis evidence from bangladesh this article examines the ricardian equivalence hypothesis reh and its sources of failure in the case of bangladesh using various theoretical specifications annual data from 1974 2001 and linear and nonlinear time series techniques the general findings tend to invalidate the reh a finite time horizon and the presence of liquidity constrained individuals are the sources of deviation from the reh empirical results reveal that real per capita private consumption c under various specifications is cointegrated generally at the 5 level with real per capita income y government expenditure before and after interest rate repayments g and g2 taxes t and the interest rate r results reveal that an increase in g g2 t and r reduces c and that an increase in budget deficits raises trade deficits these results highlight the importance of fiscal policies in boosting private consumption and controlling trade deficits which are the prime goals of stabilization policies being followed by bangladesh

the current account in the macroeconomic adjustment process macroeconomic adjustments to changes in the economic environment are to a large extent conditioned by the intertemporal choices of economic agents when agents face an intertemporal budget constraint a decision to alter current indebtedness implies changes in future consumption possibilities and will be based on expectations of the entire future path of key variables and not only current variables a formal model to show how today s current account is a function of both current and future economic variables is presented the determination of the current account under classical assumptions of market clearing and continuous full employment is emphasized

the demand for residential industrial and total electricity 1973 1998 this paper estimates residential industrial and total electricity demand by a partial adjustment approach and by a simultaneous equation approach simultaneous equation models are more appropriate since they provide negative price elasticity estimates for the residential industrial and total electricity samples flow adjustment models yield positive price elasticity estimates in some cases suggesting they fail to identify proper supply considerations that may be influencing prices the simultaneous equation approach suggests that residential customers are more price sensitive than industrial customers weather seems to have the greatest impact on the residential sector and cold weather appears to affect demand more than hot weather

ricardian equivalence rational expectations and the permanent income hypothesis the ricardian equivalence proposition and the permanent income hypothesis are tested in an intertemporal consumption model with rational expectations the representative consumer incorporates the government budget constraint an alternative hypothesis of incomplete tax discounting is nested within this model a deterministic time trend is rejected for the variables of the model variables exhibit instead a stochastic trend the permanent income model is not rejected by annual u s data i e no excess sensitivity is found the evidence with respect to ricardian equivalence is mixed the empirical study employs theorems from the cointegration literature and specifically addresses issues of nonstationary regressors copyright 1990 by ohio state university press

energy tax credits and housing improvement this paper investigates whether federal and state tax credits allowed to households who make energy saving improvements to their residence lead to an increase in improvement activity a two period utility maximization model of household behaviour is used to determine the theoretical influence of tax credits energy prices and other factors on the optimal magnitude of conservation capital improvement regressions using various qualitative measures of conservation improvement as the dependent variable are estimated using household level energy consumption and improvement data consistent with evidence from earlier surveys the empirical results do not support the hypothesis that energy tax credits lead to more widespread or more extensive energy conservation improvement activity

finite horizons life cycle savings and time series evidence on consumption abstract this paper develops an explicitly aggregated life cycle model which allows for finite horizons and declining individual labor supply the model can generate a common upward trend in aggregate consumption labor income and nonhuman wealth without relinquishing hall s random walk at the micro level life cycle factors are shown to imply that consumption changes should be a predictable and b smoother than in the infinite horizon model econometric evidence using postwar u s data suggests that neither consumption s predictability nor its excess smoothness can be fully accounted for by life cycle considerations

determinants of the current account balance in the united states this article studies the role of public and private imbalances in the behaviour of the current account balance in the united states in the context of an intertemporal model the estimation evaluates the effects of public and private imbalances on the dynamics of the current account correlation coefficients support the ricardian equivalence higher budget deficit correlates with a reduction in private consumption and an increase in private savings government saving does not vary significantly with macroeconomic variables in the short or in the long run in contrast fluctuations in government investment vary significantly with a number of economic variables in the long and in the short run accordingly fluctuations in the budget deficit are likely to be driven by fluctuations in public investment in contrast to government savings private savings vary significantly with macro variables in the long and in the short run fluctuations in private investment appear less evident compared to that in privat

the demand for road diesel in canada abstract in this paper we estimate the demand for road diesel in canada using aggregate annual data for the period 1986 2008 using a partial adjustment model pam we find short and long run price elasticities of 0 43 and 0 8 respectively however using cointegration techniques we obtain price elasticities that are 30 to 50 lower the short run elasticity with respect to gdp per capita is evaluated at 0 5 with the pam and 1 55 with cointegration in the long run both estimation techniques indicate an income elasticity around 0 9 our results underline the importance of controlling for the expansion of the primary sector which has been characterizing the canadian economy in the 2000s

temporary and permanent government spending in an open economy some evidence for the united kingdom abstract this paper investigates the effects of government spending changes on a small open economy in an intertemporal substitution framework if agents internalize the government s budget constraint temporary and permanent spending have different implications for wealth and consequently different effects on output and the balance of trade estimation of these effects isolates the different channels through which government spending can influence economic activity main findings for the united kingdom are that government spending i crowds out private spending ii is directly productive and iii when rising permanently leads to a negative wealth effect which induces a large rise in work effort

international capital mobility amongst the major industrialised countries too little or too much this paper examines capital flows among the major industrialized countries with a view to assessing m feldstein and c horioka s 1980 claim that international capital mobility is limited it argues that saving investment correlation tests are inherently flawed and proposes an alternative methodology for testing the degree of international capital mobility it finds that capital flows have been excessive in the sense that they are driven by speculative forces rather than by economic fundamentals copyright 1995 by royal economic society

domestic demand for petroleum products in mena countries abstract the purpose of this paper is to analyse the domestic demand for petroleum products in the middle east and north african mena countries employing a recent data series 1982 2005 understanding the domestic demand of oil producing countries is important due to the existence of subsidised supply loss of foreign exchange income and the environmental effects of oil use the paper analyses the evolution of petroleum product demand in mena and presents an econometric analysis of demand using a simple log linear specification for four petroleum products namely gasoline diesel kerosene and fuel oil the study covers seven mena countries namely algeria iran kuwait libya saudi arabia uae and qatar the results show that demand has grown quite fast in these countries probably because the fuel price has been kept very low while income has risen fast and thus demand has grown fast the gasoline demand model has performed better than other models in terms of producing expected signs for the parameters the results for the kerosene model was the least satisfactory as most of the coefficients were found to be statistically insignificant however in terms of numerical results this study compares well with other similar studies of the past

productivity shocks budget deficits and the current account abstract productivity shocks and budget deficits are considered to be two key determinants of the current account in order to assess formally the role of both factors in driving current account movements the present paper extends the standard intertemporal model of the current account to allow for non ricardian household behavior testable cross equation restrictions for the current account and investment are derived by drawing on the distinction between country specific and global innovations to productivity as well as to the government budget we test the restrictions of the model against time series data for 21 oecd countries and find evidence in support of the model

crandall gruenspecht keeler and lave s regulating the automobile roger smith gm s chairman called automobiles the newest regulated industry he was referring not to the capturable ministrations of a single agency but rather to the cumulative effects of disparate federal regulatory initiatives over the 1960s and 1970s although some federal initiatives have helped the industry the chrysler financial bailout and restrictions on japanese imports it is easy to be sympathetic to the industry view regulation of auto emissions and safety has had dramatic effects on automobile design although they have rarely been binding the corporate average fuel economy cafe regulations threatened to lower automobile manufacturers profitability during any period with cheap fuel and another attempted fuel saver the federal requirement of 55 mile per hour speed limits has lowered the value of automobiles in use over the period in which these regulations were put into place the domestic industry has seen its demand shifting rapidly back and forth between large and small cars and its overall market share declining as imports rose the regulations by contributing to the uncertainty and uncontrollability of the period seemed to detroit ill timed at best and costly and without benefits at worst in regulating the automobile crandall gruenspecht keeler and lave attempt a definitive treatment of a subset of these new federal regulations they focus on what might be called the auto design regulations emissions control cafe and safety standards 1 an implicit conclusion of the book is that the regulatory problem is important at the peak compliance costs for all three types amounted to more than 10 of the price of a new car see figure 2 2 p 17 the explicit conclusions that current or planned standards in all three areas are not cost beneficial and that the regulations have been poorly thought out and inefficiently implemented are an indictment of the regulatory record the approach throughout is classical the role of government regulation is to pursue the public interest while the role of scholars of regulation is to assess whether that goal is achieved not why it is being missed the conclusions the approach and the topics considered might suggest that this is an autumnal book a great deal has previously been written on these topics some controversy remains however and the book opens some interesting new ground this review will first take up the substantive areas of emissions fuel economy and safety and then turn to the book s general points about the process of regulation

a review on biogas technology and its contributions to sustainable rural livelihood in ethiopia abstract biogas technology has uneven dissemination over the globe the technology is at its infant stage of development and dissemination in many developing countries while china has the largest implementation record the principal factors controlling its dissemination include policies and institutions financial constraint subsidies availability of inputs awareness about the technology consumers considerations and success stories about the technology however biogas technology is a multipurpose technology which assists in addressing economic health social and environmental problems simultaneously thus development and dissemination of the technology certainly minimize energy poverty and improve peoples status in the energy ladder in line with this ethiopia has completed implementing the first phase 2009 2013 of its national biogas programme and has started implementing its second phase during the first phase it was able to disseminate 57 6 the total 14 000 domestic biogas plants planned for the period though the technology was introduced about five decades ago into the country biogas installations constructed prior to the establishment of the national biogas programme were having varied digester models lacked standards and central coordination and their entire number was not more than 1000 this paper reviews the status of dissemination of household biogas technology factors influencing the dissemination of the technology benefits of the technology at global scales energy resources consumption patterns and brief account of the technology at national scale ethiopia

budget balance through revenue or spending adjustments abstract the paper provides a historical perspective on the issue of whether budget deficits are typically eliminated by increased taxes or by reduced spending by examining u s budget data from 1792 1988 i conclude that about 50 65 of all deficits due to tax cuts and about 65 70 of all deficits due to higher government spending have been eliminated by subsequent spending cuts while the remainder was eliminated by subsequent tax increases in contrast to previous studies the empirical analysis uses error correction models in a way that the intertemporal budget constraint is imposed in the estimation stage

the mining industry under the thumb of politicians the environmental consequences of the spanish coal decree abstract the so called coal decree royal decree 143 2010 and subsequent royal decree 1221 2010 have modified the historical use of coal trends in the spanish economy since 2010 the use of domestic coal in spain s electricity sector will be promoted by the royal decree until 2014 this energy strategy on the one hand and political decision on the other were advanced under the flag of energy security and the fulfillment of the 9th principle of the international council of mining and metals icmm which specified that sustainable development in mining areas should maintain among other things employment the mutual understanding between the government and the local mining industry is confronted with vast criticism at the institutional firm and social levels regarding a the disparities generated between electricity generation technologies b the increase of electricity market prices the national competition commission reported the royal decree and c subsequent environmental harm the coal decree has changed the gradual decrease of coal in the spanish energy mix since the end of the 1990s the environmental efficiency gains accumulated over the past several years would be lost as a result of this change of direction in policy in the last fifteen years the coal industry in spain has been under pressure from political decisions that have forced the dismantling of the industry a labor reconversion of mining areas and the conversion of coal fired power plants into combined cycle gas power plants this situation considerably reduced co2 emissions from coal combustion in spain improving the environmental efficiency of the entire economy for many years nevertheless the implementation of the royal decree has changed these trends this paper will examine the environmental consequences of the coal decree from 2010 to 2014 based on actual economic and energy demand requirements and actual electricity mix composition a post keynesian energy age model to forecast energy demand and the derived co2 emissions will be applied to evaluate the change in the reduction of emissions observed in the electricity sector since 2005 and in the spanish economy since 2010 the results will be compared to other alternative scenarios of co2 emissions evolution

economic growth and environmental degradation the environmental kuznets curve and sustainable development abstract in this paper we critically examine the concept of the environmental kuznets curve ekc it proposes that there is an inverted u shape relation between environmental degradation and income per capita so that eventually growth reduces the environmental impact of economic activity the concept is dependent on a model of the economy in which there is no feedback from the quality of the environment to production possibilities and in which trade has a neutral effect on environmental degradation the actual violation of these assumptions gives rise to fundamental problems in estimating the parameters of an ekc the paper identifies other econometric problems with estimates of the ekc and reviews a number of empirical studies the inference from some such ekc estimates that further development will reduce environmental degradation is dependent on the assumption that world per capita income is normally distributed when in fact median income is far below mean income we carry out simulations combining ekc estimates from the literature with world bank forecasts for economic growth for individual countries aggregating over countries to derive the global impact within the horizon of the bank s forecast 2025 global emissions of so 2 continue to increase forest loss stabilizes before the end of the period but tropical deforestation continues at a constant rate throughout the period

energy and economic growth in the usa a multivariate approach abstract this paper examines the causal relationship between gdp and energy use for the period 1947 90 in the usa the relationship between energy use and economic growth has been examined by both biophysical and neoclassical economists in particular several studies have tested for the presence of a causal relationship in the granger sense between energy use and economic growth however these tests do not allow a direct test of the relative explanatory powers of the neoclassical and biophysical models a multivariate adaptation of the test vector autoregression var does allow such a test a var of gdp energy use capital stock and employment is estimated and granger tests for causal relationships between the variables are carried out although there is no evidence that gross energy use granger causes gdp a measure of final energy use adjusted for changing fuel composition does granger cause gdp

energy models for demand forecasting a review abstract energy is vital for sustainable development of any nation be it social economic or environment in the past decade energy consumption has increased exponentially globally energy management is crucial for the future economic prosperity and environmental security energy is linked to industrial production agricultural output health access to water population education quality of life etc energy demand management is required for proper allocation of the available resources during the last decade several new techniques are being used for energy demand management to accurately predict the future energy needs in this paper an attempt is made to review the various energy demand forecasting models traditional methods such as time series regression econometric arima as well as soft computing techniques such as fuzzy logic genetic algorithm and neural networks are being extensively used for demand side management support vector regression ant colony and particle swarm optimization are new techniques being adopted for energy demand forecasting bottom up models such as markal and leap are also being used at the national and regional level for energy demand management

investment in energy efficiency do the characteristics of firms matter the literature on energy efficiency provides numerous examples of apparently profitable technologies that are not universally adopted yet according to the standard neoclassical theory of investment profit maximizing firms should undertake all investments with a positive net present value the standard theory also holds that the discount rate for computing the present value of a project should be the return available on other projects in the same risk class and therefore should not depend on characteristics of the firm this model as applied to energy saving investments is tested by examining whether firms characteristics influence their decision to join the environmental protection agency s voluntary green lights program a discrete choice regression is estimated over a large sample of participating and nonparticipating firms missing values in the data matrix are replaced with multiple imputations from a distribution estimated using the expectation maximization algorithm the results show that 1 sub

a household level environmental kuznets curve abstract richer households may create more vehicle emissions because they own more vehicles and drive more poorer households may pollute more because they use high polluting vintages and maintain them less well this paper uses 1993 california vehicle microdata to show that there is a kuznets u shaped hydrocarbon emissions relation

measuring structural change and energy use decomposition of the us economy from 1997 to 2002 abstract the steadily increasing focus on energy production and consumption has led to growing research attention to patterns of energy use within economies of particular interest has been comparing the driving forces of increasing efficiency and economic structural change input output analysis ioa and decomposition analysis have become critical tools for performing such analyses this study analyzes aggregate energy use in the united states in 1997 and 2002 to discover the causes of changing energy usage and flows results show that rising population and household consumption acted to drive up energy demand but this driving force was offset by considerable structural change within the economy particularly related to a quickly increasing trade deficit in manufacturing goods thus while total energy intensity the ratio of energy use to economic output declined by approximately 12 between 1997 and 2002 changes in the structure of the economy explain this drop more than increased energy efficiency the level of aggregation at which decomposition analyses are run was identified as a crucially sensitive parameter for the determination of structural change and future studies should specifically address the amount of detail necessary to adequately measure changes in economic structure

interest rates and expected future budget deficits in the united states several recent empirical studies have found no evidence of a positive association between interest rates and current and past budget deficits one possible explanation for this finding is that interest rates are related much more to the expectation of future budget deficits than to current and past budget deficits in this paper i investigate whether this explanation is valid finding no evidence that it is section ii briefly formulates and discusses the hypothesis under consideration stating some of its implications section iii presents the results of regressing the commercial paper rate moody s aaa bond rate and the ex post real commercial paper rate on current and past government spending budget deficits and real money supplies the regressions have been fitted to the entire sample of monthly data spanning the period between june 1908 and march 1984 and to 11

do tax cuts generate twin deficits a multi country analysis we study the eects of tax shocks on the budget and external deficits for 16 industrialized countries over the post 1975 period our structural approach is based on a tractable small open economy model where a tax cut generates a budget deficit in turn the budget deficit aects the external deficit by two distinct channels the demographic channel works through the overlapping generation structure of the model the forecasting channel works through the dynamic structure of the model our empirical analysis documents that tax shocks generate significant positive comovements between the budget and external deficits we also find that both the demographic and forecasting channels are important to explain the comovements

differentiated regulation the case of auto emissions standards this paper presents an analysis of automotive emissions regulation that explicitly considers the link between regulation and the composition of the vehicle stock the adoption of more stringent emissions standards for new vehicles is shown to prolong the retention of old high emission rate vehicles in the fleet for this reason tighter new source standards actually increase aggregate emissions in the short run this result is of general as well as specific interest given the widespread use of differentiated regulatory tools incorporating a bias against new sources in many regulatory programs 3 references 1 table

consumers are not ricardian evidence from nineteen countries i introduction in conventional macroeconomic analysis government debt affects the economy because households view it as net wealth the larger the government debt is the wealthier households feel and the more they consume in principle however households need not view government debt as net wealth david ricardo pointed out that they might conceivably treat the future taxes servicing the government debt as exactly offsetting it 1 robert barro 1974 has shown that maximizing households will actually do so if they accurately anticipate future taxes if they face perfect capital markets and if they have effectively infinite horizons ricardian equivalence is said to hold if households do treat future servicing taxes as an exact offset to the government debt many empirical papers on consumption have investigated whether ricardian equivalence is consistent with observation kochin 1974 barro 1978 tanner 1979 seater 1982 kormendi 1983 aschauer 1985 seater and mariano 1985 kormendi and meguire 1986 1990 leiderman and razin 1988 evans 1988 and evans and hasan 1993 have reported evidence consistent with ricardian equivalence by contrast blinder and deaton 1985 feldstein 1978 1982 boskin and kotlikoff 1985 modigliani and sterling 1986 1990 and feldstein and elmendorf 1990 have reported evidence inconsistent with ricardian equivalence unfortunately most of these studies do not estimate regression equations that derive from well specified theoretical models nesting both ricardian equivalence and an alternative theory in which budget deficits and current taxes are not equivalent consequently their results are often hard to interpret moreover these studies consider the data for only one country typically the united states as a result the tests that are performed may not have much power to distinguish an economy for which ricardian equivalence would be a good approximation from one for which it would be a bad approximation olivier blanchard 1985 has provided one of the few models in the literature that tractably nests ricardian equivalence and an alternative in which households view government debt as net wealth depending upon whether a crucial parameter is zero or positive households have infinite horizons internalize all future generations and exhibit ricardian behavior or have finite horizons are at least somewhat disconnected from future generations and exhibit non ricardian behavior that strengthens as the parameter becomes larger the model has testable implications that this paper examines using annual data for nineteen countries when the data for the countries are pooled the tests have sufficient power not only to reject ricardian equivalence in favor of blanchard s alternative but also to yield a precise estimate of the deviation from ricardian equivalence this estimated deviation is approximately what one would expect if capital and insurance markets were perfect and households did not have altruistic bequest motives the deviation is however also economically unimportant for many purposes the rest of the paper is organized as follows section ii lays out blanchard s model and derives the testable implications of ricardian equivalence section iii tests these implications section iv summarizes the findings of the paper and interprets them ii empirical implications of ricardian equivalence in the stochastic variant of blanchard s model formulated in this section the economy is inhabited by a constant population of households that have finite horizons and face perfect capital and insurance markets 2 each household has a finite horizon because it has a probability p of dying each period and being replaced by another household from which it is entirely disconnected with the population normalized to unity the number of households born 0 1 2 periods earlier is always p p 1 p p 1 p sup

institutional ecological economics abstract new institutional economics and its forerunners have we argue made important contributions to the evolving agenda of ecological economics the conceptualisation of environmental problems as instances of interdependence and the acknowledgement of positive transaction costs are key insights into the nature of environmental problems we also discuss how plurality of behavioural motivations and limited cognitive capacity have important implications for environmental decision making and its analysis we show how evolutionary and collective action theories offer complementary takes on the choice and change of environmental governance institutions and how the concept of social capital can enrich analyses of environmental governance we conclude that an emerging institutional ecological economics has the greatest relative advantage in analysing the design implementation and effectiveness of environmental governance solutions

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

current account and budget deficits twins or distant cousins the paper develops a two country micro theoretic model consistent with the ricardian equivalence hypothesis reh specifically tax increases used to retire government debt will not affect private spending or the current account balance however increases in government spending regard less of the means of finance can be expected to induce a current account deficit an unconstrained vector autoregres sion shows some patterns in the recent u s data which appear to be inconsistent with the reh rigorous testing of the model however does not allow us to reject the indepen dence of the record federal government budget and current account deficits

energy and economic growth grounding our understanding in physical reality this article attempts to summarise the complex wide ranging and unresolved debate within the economics literature on the possibility of decoupling economic growth from energy use it explores the difference between neo classical and ecological economic worldviews and highlights how the ecological economic approach attempts to ground its analysis within the physical limits implied by the laws of thermodynamics once these laws are accounted for the possibility of decoupling economic growth from energy use seems more limited than neo classical economics implies analysis of empirical evidence also demonstrates that observed improvements in gdp energy use ratios in the usa are better explained by shifts towards higher quality fuels than by improvements in the energy efficiency of technologies this implies a need to focus on decarbonising energy supply furthermore where energy efficiency improvements are attempted they must be considered within the context of a possible rebound effect which implies that net economy wide energy savings from energy efficiency improvements may not be as large as the energy saved directly from the efficiency improvement itself both decarbonising energy supply and improving energy efficiency require the rapid development and deployment of new and existing low carbon technologies this review therefore concludes by briefly outlining areas of economic thought that have emerged as a result of engagement between economists and experts from other disciplines they include ecological evolutionary and institutional economics all of which can make policy relevant contributions to achieving a transition to a low carbon economy

fulfilling the kyoto protocol in spain a matter of economic crisis or environmental policies abstract in 2008 spain exceeded by 20 9 the co2 emissions allowed by the kyoto protocol for 2012 the financial and economic crisis has transformed these figures as production fell so did energy demand and with it co2 emissions will the spanish economic crisis allow spain to fulfill its commitments with this in mind we have developed an extended input output model able to forecast energy demand and compute co2 emissions linked to the consumption of energy goods petroleum products gas and coal the results show that the crisis and in particularly the stagnation of the construction industry is only one of the pillars which help to contain these emissions at 6 81 the possibility of incorporating environmental policies new technologies and increases in the price of crude oil in these simulations means an even greater reduction of emissions than the impact of the crisis 9 76 the final result of our most pessimistic realistic scenario is that in 2012 spain will exceed its co2 emissions linked to the combustion of energy goods by only 0 9

how many times again will we examine the energy income nexus using a limited range of traditional econometric tools during the last three decades following closely the developments in econometric theory energy and environmental economists have empirically examined the energy income nexus for different countries and time periods however today in spite of the growing interest in this area the state of knowledge is still controversial and unsettled this viewpoint paper attempts to highlight some of the issues related to the existing literature on the long run relationship and causality between energy consumption and economic growth in particular it discusses how it is difficult to make policy recommendations on the basis of inconsistent and conflicting results in the published literature on the subject in order to do so the paper first illustrates the increasing trend in the number of studies published in this area providing also a brief comparison of the conventional methods used to estimate the energy income nexus it then deals with new directions and different viewpoints on the same issue

external and budget deficits in some developing countries abstract this paper documents and explains the positive comovement between the external and budget deficits of developing countries for which post 1960 time series data are available first the estimates indicate that the empirical covariance between these deficits is always positive and is statistically significant for many cases second the empirical covariance is close to that predicted from a tractable small open economy overlapping generation model with heterogeneous goods capturing the joint behavior of the external and budget deficits also the predicted covariance is induced by shocks which are closely related to internal conditions such as domestic resources and fiscal policies and to a much lesser extent to external conditions such as the world interest rate real exchange rate and terms of trade

technology adoption subsidies an experiment with managers we evaluate the impact of technology adoption subsidies on investment behavior in an individual choice experiment in a laboratory setting professional managers are confronted with an intertemporal decision problem in which they have to decide whether or not to search for and possibly adopt a new technology technologies differ in the per period benefits they yield and their purchase price increases with the per period benefits provided we introduce a subsidy on the more expensive technologies that also yield larger per period benefits and find that the subsidy scheme induces agents to search for and adopt these more expensive technologies even though the subsidy itself is too small to render these technologies profitable we speculate that the result is driven by the positive connotation affect that the concept subsidy invokes

energy tax credits and residential conservation investment evidence from panel data using panel data on individual tax returns and variation in state tax policy we measure the impact of government tax policies to encourage residential conservation investment on the probability of making these investments unlike previous work we account for unobserved heterogeneity in tastes for energy saving activities and its possible correlation with tax policy at the state level we find that controlling for unobserved heterogeneity is very important based on our preferred point estimate of the tax price coefficient a 10 percentage point change in the tax price for energy investment would lead to a 24 percent increase in the probability of making an investment

economic search an experimental study this paper presents results of experiments designed to test several of the hypotheses present in the theoretical literature on optimal economic search first we test whether the subjects searchers actually search for wages in ways that are consistent with setting an optimal reservation wage we then proceed to determine experimentally the effects of risk aversion increased search costs changes in risk brought about by a mean preserving transformation of the distribution of wage offers the presence or absence of recall the existence of a finite horizon and the searcher s state of knowledge about the underlying distribution of wages in general we find that the searchers exhibit behavior that is consistent with that predicted by theory differences between risk neutral and risk averse searchers are found and the responses of both groups to changes in search costs in the degree of risk or in the state of knowledge are consistent with theoretical predictions

are government bonds net wealth evidence for the united states this paper investigates whether government bonds are viewed as net wealth if they are the nominal interest rate in steady state equilibrium should be an increasing function of the government debt and of government spending using forward interest rates realized during world war ii this paper finds no evidence of such a relationship these data afford an especially powerful test because the federal debt rose from 29 to 106 percent of trend output during the war this enormous increase in government debt actually appears to have reduced forward interest rates by a statistically significant but small amount

consumption permanent income and financial wealth in canada empirical evidence on the intertemporal approach to the current account the intertemporal approach to the current account is rejected as a complete explanation of the canadian current account federal government fiscal policy plays an important role in the determination of the current account a private sector agent that treats its holdings of net liabilities of the federal government as net wealth accumulates the sum of these liabilities and the net liabilities of non residents as part of an intertemporally optimal plan this result indicates both fiscal policy and intertemporal considerations are important determinants of current account behaviour consommation revenu permanent et richesse financiere au canada resultats empiriques d une approche au compte courant mettant l accent sur la dimension intertemporelle cet article montre que l approche mettant l accent sur la dimension intertemporelle ne produit pas une explication complte du comportement du compte courant canadien i1 semble que la politique fiscale du gouvernement federal joue un r6le important dans la conformation du compte courant un agent economique prive composite qui traite son portefeuille de dettes nettes du gouvernement federal comme richesse nette va accumuler la somme de ces dettes et des dettes nettes des non residents dans le cadre de son plan intertemporel optimal les resultats montrent que la politique fiscale et des considerations intertemporelles sont des elements determinants du comportement du compte courant

fiscal policy and the term structure abstract this paper investigates the empirical association between deficits in interest rates it extends the results in plosser 1982 to include the more recent experience the association between a measure of ex ante real rates and deficits is also considered the results largely corroborate the previous results first little or no association between real or nominal interest rates and deficits is found second output and to a lesser extent military spending are found to have a significant association with interest rates

the market value and maturity structure of government of canada debt 1967 83 the market value and maturity structure of outstanding government of canada debt are calculated at monthly frequency for the 1967 to 1983 period the data are disaggregated into general public chartered bank and government holdings the time series behaviour of market value and par value measures are examined to determine whether par value is a reasonable approximation for market value market value data are also used to construct an alternative measure of the deficit flow which is compared with conventional measures of the deficit la valeur au marche et la structure d echeances de la dette du gouvernement du canada 1967 83 la valeur au marche et la structure d echeances de la dette du gouvernement du canada sont calculees par les auteurs pour chaque mois au cours de la periode de 1967 a 1983 on a ventile les resultats en portions detenues par le grand public par les banques a charte et par le gouvernement les auteurs examinent ensuite la chronique des mesures de valeurs au march6 et de valeurs au pair afin de determiner si la valeur au pair est une bonne approximation de la valeur au marche on se sert alors des donnees precisant la valeur au marche pour construire un indicateur de rechange du d6ficit qu on peut alors comparer aux mesures conventionnelles du deficit

budget deficit persistence and the twin deficits hypothesis abstract this paper gauges the twin deficits hypothesis i e a positive causal relationship between the external and budget deficits this relationship is measured by the responses of the external deficit to changes in the budget deficit induced by blanchard s model these responses are positively affected by the birth rate and by the degree of persistence of the budget deficit empirical results for the canadian and us economies reveal that although the relevant birth rates are small the great persistence of the budget deficits yields responses that are numerically large and statistically positive this contrasts with previous tests of the twin deficits hypothesis which have never formally taken into account the stochastic properties of the budget deficit

income and co2 emissions evidence from panel unit root and cointegration tests abstract this paper re investigates the stationarity properties of per capita carbon dioxide co 2 emissions and real gross domestic product gdp per capita for 109 countries within seven regional panel sets covering 1971 2003 we apply the recent unit root test of the panel seemingly unrelated regressions augmented dickey fuller suradf test developed by breuer et al 2001 misleading inferences from panel unit root tests with an illustration from purchasing power parity review of international economics 9 482 493 2002 series specific unit root tests with panel data oxford bulletin of economics and statistics 64 527 546 the panel suradf test accounts for the presence of cross country correlations in the data and the parameters in the panel specification vary across countries more importantly this test allows us to identify how many and which members of the panel contain a unit root overall our empirical results illustrate that real gdp and co 2 emissions in these countries are a mixture of i 0 and i 1 processes and that the traditional panel unit root tests could lead to misleading inferences as well as the conduct of cointegration analysis being perhaps inappropriate the results of our analysis carry critical implications for the modeling of co 2 emissions and gdp because of the different orders of integration for the two variables

modelling demand for crude oil products in spain this paper develops an econometric model for the five most important crude oil products demand in spain the aim is the estimation of a range of elasticities of such demands that would serve as the basis for an applied general equilibrium model used for forecasting energy demand in a broader framework the main distinctive features of the system with respect to previous literature are i it takes advantage of monthly information coming from very different information sources and ii multivariate unobserved components uc models are implemented allowing for a separate analysis of long and short run relations uc models decompose time series into a number of unobserved though economic meaningful components mainly trend seasonal and irregular a module is added to such structure to take into account the influence of exogenous variables necessary to compute price cross and income elasticities since all models implemented are multivariate in nature the demand components are allowed to interact among them through the system noises similar to a seemingly unrelated equations model the results show unambiguously that the main factor driving demand is real income with prices having little impact on energy consumption

are consumers ricardian evidence for the united states this paper derives three empirical implications of a well specified model of consumer behavior a model that nests both ricardian equivalence and an alternative non ricardian theory ricardian equivalence is then tested against this alternative the tests reveal that ricardian equivalence cannot be rejected

testing ricardian neutrality with an intertemporal stochastic model this paper s purpose is to develop and estimate a stochastic intertemporal model of consumption be havior and to use it for testing a version of the ricardian equivalen ce proposition with time series data two channels that may give rise to deviations from this proposition are specified finite horizons a nd liquidity constraints in addition the model incorporates explici tly the roles of taxes substitution between public and private consu mption and different degrees of consumer goods durability the evid ence based on data for israel in the first half of the 1980s suppor ts the ricardian neutrality specification yielding plausible estimat es for the behavioral parameters of the aggregate consumption functio n copyright 1988 by ohio state university press

short and long run effects between oil consumption and economic growth in china this paper examines both the equilibrium relationship and the predictability between oil consumption and economic growth in china time series variables are employed in empirical tests cointegration tests suggest that these two variables tend to move together in the long run in addition granger causality tests indicate that oil consumption could be a useful factor that forecasts changes in the economy in the short run as well as in the long run the oil consumption is found to have great effects on the economy this is because the enormous use of oil in sectors like the industry may have directly pushed the economy however this finding would probably stimulate faster growth in oil consumption and so should be concerned with care conversely economic growth could be used as a predictive factor forecasting oil consumption only in the long run economic growth appears to have small effects on oil use this could be attributed largely to china s energy consumption structure coal constitutes most of the energy consumption and thus the considerable demand for energy resulting from rapid economic growth could be mostly explained by the mass use of coal

exploring the relationship between the markets for new and used durable goods the case of automobiles given that durable products are long lived there exists the possibility of secondary markets for used products as well as the potential for product obsolescence this is an important issue in markets where technology changes rapidly because the introduction of new versions of a product can make earlier versions obsolete more generally prices of older versions in the secondary market adjust in response to changes incorporated in new versions of the product thus another method of evaluating consumers response to a new product is by looking at the variation in market prices of the old product this paper develops a general model to explore the relationship between primary markets for new cars and secondary markets for used cars the results suggest that the depreciation of used cars is influenced strongly by the types of changes in new model cars

the greenhouse effect the fallacies in the energy efficiency solution abstract the view that widespread improvements in energy efficiency can by themselves do anything to halt the build up of greenhouse gases around the globe is fundamentally unsound it is based on the same fallacies that underlie the claim that energy savings from improving efficiency can substitute for new energy supply the paper by keepin and kats1 claiming that per tonne of coal not burned improvements in energy efficiency are more cost effective than substituting nuclear for coal fired power is therefore an irrelevancy as far as this debate is concerned reductions is energy intensity of output that are not damaging to the economy are associated with increases not decreases in energy demand at the macroeconomic level even within the boundaries of their own flawed approach their attempt2 to refute the critique of their thesis made by jones3 was little more than misdirected grape shot with no discernable connected thread of argument

testing a present value model of the current account evidence from us and canadian time series abstract this paper presents a simple model of current account determination based upon the permanent income hypothesis of private consumption behavior under rational expectations the model employs a representative national agent who is forward looking and can borrow and lend at a constant world interest rate a present value relationship for the current account is derived and its implications are tested on post war data for the united states and canada testing is done using the framework developed by campbell and shiller 1987 which allows the forcing variables in the model to be difference rather than trend stationary our empirical results indicate the most stringent restrictions of the present value model are strongly rejected by the us and canadian data however less formal procedures suggest the consumption smoothing model has some ability to track the dynamic behavior of the us current account jel f32

government financing decisions and asset returns abstract this paper presents an empirical investigation of the relation between government financing decisions and asset returns in particular the focus is on whether a substitution of debt financing for tax financing of a given level of expenditures is associated with an increase in interest rates the paper brings a different perspective to empirical investigations of government fiscal policies by examining the response of asset prices in an efficient capital market to such policies rather than focusing on aggregate consumption behavior the results are consistent with the idea that asset prices are unrelated to how the government finances its expenditures the results however also indicate that the capital market is not indifferent with respect to the level of government expenditures as higher interest rates are associated with increases in government purchases

a procedure to evaluate cyclical fluctuations under superior information this article presents and assesses a procedure to evaluate conventional moments characterizing fluctuations at the business cycle frequency when the economic agents information set is superior to the econometrician s one first we derive the theoretical conditions under which the econometrician obtains valid statistics for the moments from laws of motion for forcing variables that fully recover the agents superior information second we use a new keynesian monetary model to document the numerical properties of the statistics when the laws of motion are possibly misspecified and to assess the ability of certain information criteria to detect the presence of superior information

the social return on investment in the energy efficiency of buildings in germany the german government has developed a variety of policy instruments intended to reduce national co2 emissions these instruments include a programme administered by kfw bank which aims at improving the energy efficiency of buildings it provides attractive credit conditions or subsidies to finance refurbishment measures which improve the energy efficiency of buildings significantly the refurbishment programme leads to a reduction in energy use which benefits private investors by reducing their energy bills in order to estimate whether the programme benefits society as a whole additional effects must be taken into account such as the amount of employment generated and the impact on the public budget the aim of this paper is to evaluate the social benefits of the german co2 refurbishment programme for the years 2005 2007 an extended input output model is used to estimate the effect of the refurbishment works on public revenue via taxes and social security contributions the value of avoided co2 emissions is approximated using a range of marginal damage estimates from the literature from these social benefits the programme cost is deducted the net social benefit thus computed turns out to be positive this finding suggests that the refurbishment programme is a reasonable investment of public funds

do budget deficits raise nominal interest rates evidence from six countries abstract it is widely believed that budget deficits raise nominal interest rates this paper shows that the belief has no empirical support for six countries ricardian equivalence may explain the lack of a positive association between budget deficits and nominal interest rates