bluuebunny/crossref_metadata_2025 huggingface dataset:
Public Health Policy and Law for Pandemic Influenza: A Case for European Harmonization?
Authors: Martin Robyn , Conseil Alexandra
Published: August 2012

This article provides a critical portrait of the current state of public health policies and laws governing pandemic influenza prevention and control in Europe. It examines the role of and relationship between national public health policy and national communicable disease legislation as tools for the prevention and control of pandemic influenza, the role of Europe in pandemic disease preparedness, and the concept of harmonization across European states, including an overview of supranational initiatives and powers created to enhance harmonization of national pandemic disease policy. Short case studies epitomize important concerns around harmonization in Europe. The article considers opportunities and impediments to further harmonization. Particular attention is paid to the essential role of law as a tool to underpin and implement preparedness policies and to protect individual rights against unjustified state intervention.
Public Health in a Transnational Context: Explaining Europe's Role
Authors: Taylor Rosemary C. R.
Published: August 2012

This commentary explores explanations for the EU's increasing involvement in public health. Through an examination of two case studies — policies on HIV/AIDS and preparations for pandemic influenza — it explores the process by which new ideas are disseminated in a policy sphere and the influence of law, economic interests, and international guidelines in making public health policy. It concludes by asking, with a comparative look at the United States, whether a European convergence on measures to control communicable disease is desirable.
AIP1 acts with cofilin to control actin dynamics during epithelial morphogenesis
Authors: Chu Dandan , Pan Hanshuang , Wan Ping , Wu Jing , Luo Jun , Zhu Hong , Chen Jiong
Published: August 2012

During epithelial morphogenesis, cells not only maintain tight adhesion for epithelial integrity but also allow dynamic intercellular movement to take place within cell sheets. How these seemingly opposing processes are coordinated is not well understood. Here, we report that the actin disassembly factors AIP1 and cofilin are required for remodeling of adherens junctions (AJs) during ommatidial precluster formation in Drosophila eye epithelium, a highly stereotyped cell rearrangement process which we describe in detail in our live imaging study. AIP1 is enriched together with F-actin in the apical region of preclusters, whereas cofilin displays a diffuse and uniform localization pattern. Cofilin overexpression completely rescues AJ remodeling defects caused by AIP1 loss of function, and cofilin physically interacts with AIP1. Pharmacological reduction of actin turnover results in similar AJ remodeling defects and decreased turnover of E-cadherin, which also results from AIP1 deficiency, whereas an F-actin-destabilizing drug affects AJ maintenance and epithelial integrity. Together with other data on actin polymerization, our results suggest that AIP1 enhances cofilin-mediated actin disassembly in the apical region of precluster cells to promote remodeling of AJs and thus intercellular movement, but also that robust actin polymerization promotes AJ general adhesion and integrity during the remodeling process.
Rab-genome analysis reveals novel insights in Weibel-Palade body exocytosis
Authors: Zografou Sofia , Basagiannis Dimitris , Papafotika Alexandra , Shirakawa Ryutaro , Horiuchi Hisanori , Auerbach Daniel , Fukuda Mitsunori , Christoforidis Savvas
Published: August 2012

Weibel-Palade bodies (WPBs) are endothelial-specific organelles, which, upon fusion with the plasma membrane, release cargo molecules that are essential in critical blood vessel functions such as thrombosis, inflammation and angiogenesis. Despite the importance of WPBs, the basic mechanisms that mediate their secretion are only poorly understood. Rab GTPases play fundamental role in the trafficking of intracellular organelles. Yet, the only known WPB-associated Rabs are Rab27a and Rab3d. Here, to determine the full spectrum of WPB-Rabs we performed a complete Rab-genome screening by analyzing the localization of all Rabs in WPBs and their involvement in the secretory process in endothelial cells. Apart from Rab3 and Rab27, we identified three additional Rabs, Rab15 (a previously reported endocytic Rab), Rab33 and Rab37, on the WPB limiting membrane. A knocking down approach using siRNAs showed that among these five WPB-Rabs only Rab3, Rab27 and Rab15 are required for exocytosis. Intriguingly, we found that Rab15 cooperates with Rab27a in WPB secretion. Furthermore, a specific effector of Rab27, Munc13-4, appears to be also an effector of Rab15 and is required for WPB exocytosis. These data indicate that WPB secretion requires the coordinated function of a specific group of Rabs and that, among them, Rab27a and Rab15, as well as their effector Munc13-4, cooperate to drive exocytosis.
Filopodium retraction is controlled by adhesion to its tip
Authors: Romero Stephane , Quatela Alessia , Bornschlögl Thomas , Guadagnini Stéphanie , Bassereau Patricia , Van Nhieu Guy Tran
Published: August 2012

Filopodia are thin cell extensions sensing the environment. They play an essential role during cell migration, cell-cell or cell-matrix adhesion, by initiating contacts and conveying signals to the cell cortex. Pathogenic microorganisms can hijack filopodia to invade cells by inducing their retraction towards the cell body. Because their dynamics depend on a discrete number of actin filaments, filopodia provide a model of choice to study elementary events linked to adhesion and downstream signaling. However, the determinants controlling filopodial sensing are not well characterized. Here, we have used beads functionalized with different ligands that triggered filopodial retraction when contacting filopodia of epithelial cells. With optical tweezers (OTs), we were able to measure forces stalling the retraction of a single filopodium. We found that the filopodial stall force depends on the coating of the bead. Stall forces reached 8 pN for beads coated with the β1- integrin ligand Yersinia Invasin, while retraction was stopped with a higher force of 15 pN when beads were functionalized with carboxyl groups. In all cases, stall forces increased in correlation with the density of ligands contacting filopodial tips and were independent of the optical trap stiffness. Unexpectedly, a discrete and small number of Shigella type three secretion systems induced stall forces of 10 pN. These results suggest that the number of receptor-ligand interactions at the filopodial tip determines the maximal retraction force exerted by filopodia but a discrete number of clustered receptors is sufficient to induce high retraction stall forces.
WD40-repeat protein 62 is a JNK-phosphorylated spindle pole protein required for spindle maintenance and timely mitotic progression.
Authors: Bogoyevitch Marie A. , Yeap Yvonne Y. C. , Qu Zhengdong , Ngoei Kevin R. , Yip Yan Y. , Zhao Teresa T. , Heng Julian I. , Ng Dominic C. H.
Published: August 2012

The impact of aberrant centrosomes/spindles on asymmetric cell division in embryonic development indicates the tight regulation of bipolar spindle formation and positioning for mitotic progression and cell fate determination. WD40-repeat protein 62 (WDR62) was recently identified as a spindle pole protein linked to the neurodevelopmental defect of microcephaly but its roles in mitosis have not been defined. We report here that the in utero electroporation of neuroprogenitor cells with WDR62 siRNAs induced their cell cycle exit and reduced their proliferative capacity. In cultured cells, we demonstrated cell cycle-dependent accumulation of WDR62 at the spindle pole during mitotic entry that persisted until metaphase-anaphase transition. Utilizing siRNA-depletion, we revealed WDR62 function in stabilizing the mitotic spindle specifically during metaphase. WDR62 loss resulted in spindle orientation defects, decreased the integrity of centrosomes displaced from the spindle pole and delayed mitotic progression. Additionally, we revealed JNK phosphorylation of WDR62 was required for maintaining metaphase spindle organization during mitosis. Our study provides the first functional characterization of WDR62 and has revealed requirements for JNK/WDR62-signalling in mitotic spindle regulation that may be involved in coordinating neurogenesis.
PKA isoforms coordinate mRNA fate during nutrient starvation
Authors: Tudisca Vanesa , Simpson Clare , Castelli Lydia , Lui Jennifer , Hoyle Nathaniel , Moreno Silvia , Ashe Mark , Portela Paula
Published: August 2012

A variety of stress conditions induce mRNA and protein aggregation into mRNA silencing foci, but the signalling pathways mediating these responses are still elusive. Previously we demonstrated that PKA catalytic isoforms Tpk2 and Tpk3 localize with processing and stress bodies in Saccharomyces cerevisiae. Here, we show that Tpk2 and Tpk3 are associated with translation initiation factors Pab1 and Rps3 in exponentially growing cells. Glucose starvation promotes the loss of interaction between Tpk and initiation factors followed by their accumulation into processing bodies. Analysis of mutants in the individual PKA isoform genes has revealed that the TPK3 or TPK2 deletion affects the capacity of the cells to form granules and arrest translation properly in response to glucose starvation or stationary phase. Moreover, we demonstrate that PKA controls Rpg1 and eIF4G1 protein abundance possibly controlling cap-dependent translation. Taken together, our data suggest that the PKA pathway coordinates multiple stages in the fate of mRNAs with nutritional environment and growth status of the cell.
Morphological specialization influences nectar extraction efficiency of sympatric nectar-feeding bats
Authors: Gonzalez-Terrazas Tania P. , Medellin Rodrigo A. , Knörnschild Mirjam , Tschapka Marco
Published: August 2012

Mammals frequently use nectar as a supplementary food, while a predominantly nectarivorous lifestyle with morphological specializations for this feeding mode is rare within the class. However, Neotropical flower-visiting bats largely depend on nectar resources and show distinct adaptations to a nectar diet. Glossophagine bats form local guilds of 2-6 species that may differ distinctly in skull morphology. It is still unknown how and to what extent this morphological diversity influences the efficiency of nectar extraction and hence also resource partitioning within the local bat guild. As foraging behaviour is a key factor for niche partitioning of coexisting species, we compared nectar extraction behaviour and efficiency at different flower depths among sympatric bat species with different degrees of morphological specialization (Glossophaga soricina, Leptonycteris yerbabuenae, Musonycteris harrisoni). In flight cage experiments with artificial flowers all species showed at deeper nectar levels a decrease in the amount extracted per visit and an increase in time spent hovering at the flower, indicating increased energetic cost when foraging on longer-tubed flowers. The lowest nectar extraction efficiency (g/s) was found in the small G. soricina and the highest in the largest species L. yerbabuenae. However, when considering also the different energy requirements of the different-sized bat species, the morphologically most specialized Musonycteris harrisoni showed consistently the highest foraging efficiency. Our data suggest that the long rostrum and tongue of the extremely specialized M. harrisoni are probably not evolved for monopolization of coevolved deep flowers, but allow efficient access to the broadest range of the local chiropterophilous flower community.
Pre- and post-natal stress in context: effects on the stress physiology in a precocial bird
Authors: Marasco Valeria , Robinson Jane , Herzyk Pawel , Spencer Karen Anne
Published: August 2012

Developmental stress can significantly influence physiology and survival in many species. Mammalian studies suggest that pre- and post-natal stress can cause different effects (i.e. hyper- or hypo-responsiveness) on the Hypothalamic-Pituitary-Adrenal axis (HPA axis), the main mediator of the stress response. In mammals, the physiological intimacy between mother and offspring constrains the possibility to control, and therefore to manipulate, maternal pre- and post-natal influences. Here, by using the Japanese quail (Coturnix c. japonica) as our model, we elevated the glucocorticoid stress hormone corticosterone in ovo and/or in the endogenous circulation of hatchlings. We examined the effects of treatments on corticosterone and glucose stress responses at two different ages, in juvenile and adult quail. In juveniles, corticosterone data revealed a sex-specific effect of post-natal treatment regardless of the previous pre-natal protocol, with post-natally treated females showing shorter stress responses in comparison with the other groups, while no differences were observed among males. In adulthood, birds previously stressed as embryos showed higher corticosterone concentrations over the stress response compared with controls. This effect was not evident in birds subjected to either post- or the combined treatments. There were no effects on glucose in the juveniles. However, adult birds previously stressed in ovo showed opposite sex-specific basal glucose patterns compared with the other groups. Our results demonstrate that (1) early glucocorticoid exposure can have both transient and long-term effects on the HPA axis, depending upon the developmental stage and sex and (2) post-natal stress can modulate the effects of pre-natal stress on HPA activity.
High oxidative capacity and type IIx fibre content in springbok and fallow deer skeletal muscle suggest fast sprinters with a resistance to fatigue
Authors: Curry Jennifer W. , Hohl Rodrigo , Noakes Timothy D. , Kohn Tertius A.
Published: August 2012

Some wild antelopes are fast sprinters and more resistant to fatigue than others. This study therefore investigated two wild antelope species to better understand their reported performance capability. Muscle samples collected post mortem from the Vastus lateralis and Longissimus lumborum of fallow deer (Dama dama) and springbok (Antidorcas marsupialis) were analysed for myosin heavy chain isoform content, citrate synthase (CS), 3-hydroxyacyl Co A dehydrogenase, phopshofructokinase, lactate dehydrogenase and creatine kinase activities. Cross-sectional areas, fibre type and oxidative capacities of each fibre type were determined in the Vastus lateralis only. The predominant fibre type in both muscle groups and species were type IIX (>50%), with springbok having more type IIX fibres than fallow deer (P < 0.05). Overall cross-sectional area was not different between the two species. The metabolic pathway analyses showed high glycolytic and oxidative capacities for both species, but springbok had significantly higher CS activities than fallow deer. Large variation and overlap in oxidative capacities existed within and between the fibre types. Some type IIX fibres presented with similar oxidative capacities as that from type I and IIA fibres. The data suggest that springbok and fallow deer could sprint at >90 km h-1 and 46 km h-1, respectively, partly from having large type IIX fibre contents and high glycolytic capacities. The high oxidative capacities also suggest animals that could withstand fatigue for long periods of time.
The ontogenetic scaling of bite force and head size in loggerhead sea turtles (Caretta caretta): implications for durophagy in neritic, benthic habitats
Authors: Marshall Christopher D. , Guzman Alejandra , Narazaki Tomoko , Sato Katsufumi , Kane Emily A. , Sterba-Boatwright Blair D.
Published: August 2012

Ontogenetic studies of vertebrate feeding performance can help address questions relevant to foraging ecology. Feeding morphology and performance can either limit access to food resources or open up new trophic niches in both aquatic and terrestrial systems. Loggerhead sea turtles are long-lived vertebrates with complex life histories that are marked by an ontogenetic shift from an oceanic habitat to a coastal neritic habitat, and a transition from soft oceanic prey to hard, benthic prey. Although considered durophagous and strong biters, bite performance has not been measured in loggerheads, nor has the ontogeny of bite performance been characterized. In the present study, we collected measurements of bite force in loggerhead turtles from hatchlings to adults. When subadults reach the body size when the ontogenetic shift occurs, their crushing capability is great enough to consume numerous species of hard benthic prey but at smaller sizes. As loggerheads mature and bite performance increases, larger and harder benthic prey become accessible. Loggerhead bite performance eventually surpasses the crushing capability of other durophagous carnivores, thereby potentially reducing competition for hard benthic prey. The increasing bite performance and accompanying morphology of the head and jaws is likely an effective mechanism for resource partitioning and decreasing trophic competition. Simultaneous measurements of body and head size and the use of non-linear reduced major axis regression show that bite force increases with significant positive allometry relative to body size (straight carapace length, straight carapace width, and mass) and head size (head width, height, and length). Simple correlation showed that all logged morphometrics were good predictors of logged bite performance, but an AICc-based weighted regression showed that body size (SCW followed by SCL and mass, respectively) were more likely predictors of bite force than head size morphometrics (HW and HL).
Fatiguing stimulation of one skeletal muscle triggers heat shock proteins activation in several rat organs: the role of muscle innervation
Authors: Jammes Yves , Steinberg Jean G , By Youlet , Brerro-Saby Christelle , Condo Jocelyne , Olivier Marine , Guieu Regis , Delliaux Stephane
Published: August 2012

We hypothesized that muscle afferents activation by fatigue may trigger a spread out activation of heat shock proteins (HSP) in resting muscles and different organs. In anesthetized rats, HSP25 and HSP70 levels were determined in both tibialis anterior (TA) and extensor digitorum longus (EDL) muscles, diaphragm, kidney, and brain using ELISA kits, which mostly explore the phosphorylated HSP, and Western blotting (WB). One TA muscle was electrically stimulated and tissues sampled 10 (Test10) or 60 min (Test60) after the stimulation had ended. The nerve supply to the stimulated TA or its pair in the contralateral limb was left intact or suppressed. In control rats, no muscle stimulation was performed and tissues were sampled at the same time (C10 and C60). After TA stimulation, ELISA measured increased HSP25 content in contralateral TA, EDL, and diaphragm at Test 10 but not Test 60, and HSP70 increased in all sampled tissues at Test60. WB did not measure HSP25 and HSP70 variations at Test 10 while at Test 60 HSP25 increased in all sampled tissues except the brain and HSP70 was elevated in all tissues. Denervation of the contralateral non stimulated limb suppressed HSP variations in TA and after denervation of the stimulated TA the spread out activation of HSPs in other organ was absent. Our data suggest that fatigue-induced activation of skeletal muscle afferents triggers an early increase in phosphorylated HSP25 in muscles and a delayed elevation of non phosphorylated HSP25 and HSP70 in skeletal and respiratory muscles, kidney, and brain.
Protective effect of hypothermia on brain potassium homeostasis during repetitive anoxia in Drosophila melanogaster
Authors: Rodriguez Esteban C. , Robertson R. Meldrum
Published: August 2012

Oxygen deprivation in nervous tissue depolarizes cell membranes, increasing extracellular potassium concentration ([K+]o). Thus, [K+]o can be used to assess neural failure. The effect of temperature (17°C, 23°C or 29°C) on the maintenance of brain [K+]o homeostasis in male Drosophila melanogaster (w1118) individuals was assessed during repeated anoxic comas induced by N2 gas. Brain [K+]o was continuously monitored using K+-sensitive microelectrodes while body temperature was changed using a thermo electric cooler (TEC). Repetitive anoxia resulted in a loss of the ability to maintain [K+]o baseline at 6.6±0.3 mM. The total [K+]o baseline variation (Δ[K+]o) was stabilized at 17°C (-1.1±1.3 mM), mildly rose at 23°C (17.3±1.4 mM), and considerably increased at 29°C (332.7±83.0 mM). We conclude that 1) reperfusion patterns consisting of long anoxia, short normoxia and high cycle frequency increased disruption of brain [K+]o baseline maintenance, and 2) hypothermia had a protective effect on brain K+ homeostasis during repetitive anoxia. Male flies are suggested as a useful model for examining deleterious consequences of O2 reperfusion with possible application on therapeutical treatment of stroke or heart attack.
Doubts About the McKinnon Standard
Authors: Dornbusch Rudiger
Published: August 2012

[This paper responds to “Monetary and Exchange Rate Policies for International Financial Stability: A Proposal,” by Ronald I. McKinnon, in this same issue.] For over ten years, Ronald McKinnon has advocated a new monetary system centered on fixed exchange rates between the Japanese yen, the German mark, and the U.S. dollar. His proposal has fallen on fertile soil because the dramatic volatility in exchange rates makes the financial press and the business community grasp for ready answers. McKinnon's scheme seems to solve the problem of currency instability and to judge from his presentation there are only merits and not one shortcoming. In fact, however, there is little theoretical or empirical basis for his standard. To support this criticism, I will first summarize several of McKinnon's key propositions and prescriptions and then review these in a critical spirit.
Comment on McKinnon's Monetary Rule
Authors: Williamson John
Published: August 2012

[This paper responds to “Monetary and Exchange Rate Policies for International Financial Stability: A Proposal,” by Ronald I. McKinnon, in this same issue.] While McKinnon's criticisms of the regime of floating exchange rates are almost entirely justified, I argue that both his analysis and his diagnosis are flawed. His analysis presupposes a very special set of parameters which result in changes in the budget deficit leading to equal changes in the trade balance while leaving output unchanged. In fact, achieving this result requires also changes in relative prices, which are best induced by changes in exchange rates. This points to one of the four important social functions of exchange rate flexibility that are denied or ignored by McKinnon and that would be forfeited under his proposal. In contrast, target zones offer escape from the major costs of floating while retaining the important advantages that flexible rates offer.
Frequentist and Subjectivist Perspectives on the Problems of Model Building in Economics
Authors: Poirier Dale J
Published: August 2012

I plan to discuss, in as simple and nontechnical a fashion as possible, the subjectivist-Bayesian attitude toward model building in econometrics and to contrast it with the standard frequentist attitude. To convey what I believe is the principle distinguishing attitude between Bayesians and non-Bayesians, I refer to their respective positions as “subjectivist” and “frequentist.” The basic differences between these positions arise from different interpretations of “probability.” Frequentists interpret probability as a property of the external world, i.e., the limiting relative frequency of the occurrence of an event as the number of suitably defined trials goes to infinity. For a subjectivist, probability is interpreted as a degree of belief fundamentally internal to the individual as opposed to some characteristic of the external world. Subjective probability measures a relationship between the observer and events (not necessarily “repetitive”) of the outside world, expressing the observer's personal uncertainty about those events. The subjectivist paradigm is designed to produce “coherent” revisions in beliefs about future observables in light of observed data. Most of the issues I raise are familiar to statisticians but not to economists. Rather than give the suspicious reader a menu of Bayesian techniques, I hope to create an interest in acquiring a taste for the Bayesian cuisine by recommending five pragmatic principles.
Comment on Poirier: The Subjective Perspective of a “Spiritual Bayesian”
Authors: Rust John
Published: August 2012

[This paper responds to “Frequentist and Subjectivist Perspectives on the Problems of Model Building in Economics,” by Dale J. Poirier, in this same issue.] Professor Dale Poirier has preached a rousing sermon for the Bayesian cause and in doing so has concisely exposed some of the cracks in the foundations of statistics. One of these cracks is the very interpretation of the concept of probability, a philosophical question that has never been fully resolved and has led to the schism that currently exists in statistics between the Bayesian and classical schools. The paper is valuable for econometricians because it challenges them to think more deeply about the meaning of the statistical procedures they employ. However a basic question was not addressed; namely, what is the purpose of statistical inference? I think the answer to this question has at least as much bearing upon whether someone adopts Bayesian or classical methodology as whether one interprets the meaning of probability in subjectivist or frequentist terms. I think that the purpose of statistical inference is to “learn.” This view treats statistical inference as a process of formulating a sequence of models that are abstract but in some sense increasingly accurate representations of certain aspects of reality that we seek to understand. In the rest of this piece, I will discuss the limitations of Bayesian estimation theory and the limitations of Classical Estimation theory.
Comment on Poirier: Operational Bayesian Methods in Econometrics
Authors: Geweke John
Published: August 2012

[This paper responds to “Frequentist and Subjectivist Perspectives on the Problems of Model Building in Economics,” by Dale J. Poirier, in this same issue.] My purpose in this comment is to illustrate that economists can indeed act upon the agenda implied by Poirier's five pragmatic principles of model building. Many economic researchers have had a subjective view of the world for a long time. But now, the argument that Bayesian approaches do not lead to operational methods, often decisive one or two decades ago, is becoming irrelevant in rapidly increasing numbers of applications as cheap and massive desktop computing power spreads. For the foreseeable future there will be substantial returns to developing appropriate numerical methods of Bayesian inference in econometrics, and to using these methods in empirical work. Many econometric problems that are messy and intractable from a classical perspective can become elegant and straightforward from a Bayesian perspective. I am not interested in defending this statement as an abstract proposition. Rather, I am interested in providing solutions to problems that have been stubbornly immune to treatment by classical methods. I will take up two of the scores of such problems here.
Symposium on Takeovers
Authors: Varian Hal R
Published: August 2012

Of the hundred largest mergers and acquisitions on record up to 1984, 65 occurred between 1981 and 1983, and only 11 occurred prior to 1979. During the 1981-84 period, there were at least 45 transactions of over a billion dollars apiece; prior to this period there were only a dozen or so transactions of such magnitude. What is the meaning of this “merger mania?” Why did it occur so suddenly? Is the wave of takeovers merely a speculative bubble, or is it motivated by fundamental economic conditions? What can we expect in the future? What policy responses, if any, are appropriate in light of this explosion of takeover activity? The papers in this symposium offer four perspectives on takeover activities.
Value Maximization and the Acquisition Process
Authors: Shleifer Andrei , Vishny Robert W
Published: August 2012

Like the rest of us, corporate managers have many personal goals and ambitions, only one of which is to get rich. The way they try to run their companies reflects these personal goals. Shareholders, in contrast, deprived of the pleasures of running the company, only care about getting rich from the stock they own. The takeover wave of the 1980s put the managershareholder conflict to a new test. Where other checks on management failed, hostile takeovers could now wrest control from managers who ignored the interests of their shareholders. More so than ever before, fear of such disciplinary takeovers has forced managers to listen to shareholder wishes. But even now, many acquisitions are not of this disciplinary variety. Ironically, making acquisitions is often just the quickest and easiest way for managers to expand the scope of their control by directing the firm's cash flows into new ventures. In this paper, we appraise the acquisition process from the managerial perspective. Has the pressure brought by hostile takeovers effectively restricted non-value-maximizing conduct by managers? Are acquisitions themselves driven by non-value-maximizing behavior on the part of acquiring managers? We conclude with some recommendations for improving the takeover process.
Monetary and Exchange Rate Policies for International Financial Stability: A Proposal
Authors: McKinnon Ronald I
Published: August 2012

What keeps the three major industrial blocs -- Western Europe, North America, and industrialized Asia -- from developing a common monetary standard to prevent exchange-rate fluctuations? One important reason is the differing theoretical perspectives of economic advisers. The first issue is whether or not a floating foreign exchange market -- where governments do not systematically target exchange rates -- is “efficient.” Many economists believe that exchange risk can be effectively hedged in forward markets so international monetary reform is unnecessary. Second, after a decade and a half of unremitting turbulence in the foreign exchange markets, economists cannot agree on “equilibrium” or desirable official targets for exchange rates if they were to be stabilized. The contending principles of purchasing power parity and of balanced trade yield very different estimates for the “correct” yen/dollar and mark/dollar exchange rates. Third, if the three major blocs can agree to fix nominal exchange rates within narrow bands, by what working rule should the new monetary standard be anchored to prevent worldwide inflation or deflation? After considering the magnitude of exchange-rate fluctuations since floating began in the early 1970s, I analyze these conceptual issues in the course of demonstrating how the central banks of Japan, the United States, and Germany (representing the continental European bloc) can establish fixed exchange rates and international monetary stability.
Anomalies: Parimutuel Betting Markets: Racetracks and Lotteries
Authors: Thaler Richard H , Ziemba William T
Published: August 2012

Economists have given great attention to stock markets in their efforts to test the concepts of market efficiency and rationality. Yet wagering markets are, in one key respect, better suited for testing market efficiency and rationality. The advantage of wagering markets is that each asset (bet) has a well-defined termination point at which its value becomes certain. The absence of this property is one of the factors that has made it so difficult to test for rationality in the stock market. Since a stock is infinitely lived, its value today depends both on the present value of future cash flows and on the price someone will pay for the security tomorrow. Indeed, one can argue that wagering markets have a better chance of being efficient because the conditions (quick, repeated feedback) are those which usually facilitate learning. However, empirical research has uncovered several interesting anomalies. While there are numerous types of wagering markets, legal and otherwise, this column will concentrate on racetrack betting and lotto-type lottery games.
Intergenerational Transfers and Savings
Authors: Kotlikoff Laurence J
Published: August 2012

What is the main explanation for savings? Is it primarily accumulation for retirement as claimed by Albert Ando, Richard Brumberg, and Franco Modigliani in their celebrated Life Cycle Model of Savings? Is it primarily intentional accumulation for intergenerational transfers? Or is it primarily precautionary savings, much of which may be bequeathed because of imperfections in annuity markets? The answer to the savings puzzle has many policy implications and is key to understanding the distribution of wealth. A major piece of the puzzle is the quantitative importance of intergenerational transfers to the accumulation of wealth. As I will argue there is strong evidence that intergenerational transfers play a very important and perhaps dominant role in U.S. wealth accumulation. This does not mean, however, that intentional saving for gifts and bequests is the main motive for savings. Significant intergenerational transfers could also arise in the Life Cycle Model in the absence of well-functioning private annuity markets or close substitutes for such markets. In such a setting, bequests would be involuntary and potentially quite sizeable. Let us first look at the evidence on the importance of intergenerational transfers and then turn to the deeper question of why such transfers arise.
Contraction and Expansion: The Divergence of Private Sector and Public Sector Unionism in the United States
Authors: Freeman Richard B
Published: August 2012

The institutional structure of the American labor market changed remarkably from the 1950s and 1960s to the 1980s. What explains the decline in union representation of private wage and salary workers? Why have unions expanded in the public sector while contracting in the private sector? Is the economy-wide fall in density a phenomenon common to developed capitalist economies, or is it unique to the United States? To what extent should economists alter their views about what unions do to the economy in light of the fact that they increasingly do it in the public sector? To answer these questions I examine a wide variety of evidence on the union status of public and private workers. I contrast trends in unionization in the United States with trends in other developed countries, particularly Canada, and use these contrasts and the divergence between unions in the public and private sectors of the United States to evaluate proposed explanations.
The Political Economy of Immigration Law: Impact of Simpson-Rodino on the United States and Mexico
Authors: Reynolds Clark W , McCleery Robert K
Published: August 2012

About two years ago the United States passed the Immigration Reform and Control Act, also called the “Simpson-Rodino” bill of 1986. The Act called for increased enforcement of migration policy, employer sanctions, and amnesty for those who could prove continuous residence since 1982. Despite considerable discussion and debate prior to the act, the legislation was passed without any comprehensive economic analysis of its potential impact on the United States or its main source of undocumented immigration, Mexico. In this paper we shall look at some implications of the recent immigration law for both economies, given their widely differing levels of income and productivity, the challenges each faces to restructure its economy given increased international competitiveness, and the particular problems and opportunities presented by a common border with growing labor market interdependence. By our calculations, the economic opportunity cost of Simpson-Rodino as compared to continuation of the prior status quo will add up to a present value of $110 billion between now and the year 2000. In fact, Simpson-Rodino illustrates the important role that labor mobility may play in the convergence of income and productivity between rich and poor countries. It shows how migration policy may distort or delay that process of convergence, with negative implications for both societies.
Minimum Wage Laws: Are They Overrated?
Authors: Brown Charles
Published: August 2012

I think there is a reasonably high degree of agreement in studies of the impact of the minimum wage on employment, unemployment, and the distribution of income -- though I will also point to a few areas where further work could refine our understanding of labor markets, and perhaps even change the prevailing view of the impact of the minimum wage. I consider the textbook minimum wage theory; complications of partial coverage and heterogeneous workers; the estimated impact on employment and unemployment; whether there should be a lower wage for teenagers; and the effect of the minimum wage on the income distribution. In the end, what have we learned? The effects of the minimum wage on employment are smaller than I would have supposed. The minimum wage is overrated: by its critics as well as its supporters.
Variable Trends in Economic Time Series
Authors: Stock James H , Watson Mark W
Published: August 2012

The two most striking historical features of aggregate output are its sustained long run growth and its recurrent fluctuations around this growth path. Over horizons of a few years, these shorter cyclical swings can be pronounced; for example, the 1953, 1957, and 1974 recessions are evident as substantial temporary declines in aggregate activity. These cyclical fluctuations are, however, dwarfed in magnitude by the secular expansion of output. But just as there are cyclical swings in output, so too are there variations in the growth trend: growth in GNP in the 1960s was much stronger than it was in the 1950s. Thus, changes in long-run patterns of growth are an important feature of postwar aggregate economic activity. In this article, we discuss the implications of changing trends in macroeconomic data from two perspectives. The first perspective is that of a macroeconomist reassessing the conventional dichotomy between growth and stabilization policies. As an empirical matter, does this dichotomy make sense for the postwar United States? What is the relative “importance” of changes in the trend and cyclical swings in explaining the quarterly movements in economic aggregates? We next adopt the perspective of an econometrician interpreting empirical evidence based on data that contain variable trends. The presence of variable trends in time series data can lead one to draw mistaken inferences using conventional econometric techniques. How can these techniques -- or our interpretation of them -- be modified to avoid these mistakes?
Anomalies: Cooperation
Authors: Dawes Robyn M , Thaler Richard H
Published: August 2012

Much economic analysis -- and virtually all game theory -- starts with the assumption that people are both rational and selfish. The predictions derived from this assumption of rational selfishness are, however, violated in many familiar contexts. In this column and the next one, the evidence from laboratory experiments is examined to see what has been learned about when and why humans cooperate. This column considers the particularly important case of cooperation vs. free riding in the context of public good provision.
Trading Activity and Price Behavior in the Stock and Stock Index Futures Markets in October 1987
Authors: Gammill James F , Marsh Terry A
Published: August 2012

This paper discusses what actually happened during the October 1987 market break and the days immediately before. It attempts to lay out a set of stylized facts that describe differing categories of traders and how they behaved and reacted to each other during those days. We believe that this description of what actually happened provides a necessary starting point for financial economists interested in explaining the stock market break. Our discussion here will rely heavily on the report of the Presidential Task Force on Market Mechanisms, created by Ronald Reagan to investigate these events, as well as on the reports of the Securities and Exchange Commission and the Commodity Futures Trading Commission. [Both authors were staff members with the Presidential Task Force on Market Mechanisms.] We focus on trading activity on the New York Stock Exchange (NYSE) and on the S&P 500 stock index futures contract traded on the Chicago Mercantile Exchange (CME).
The Task Force Report: The Reasoning Behind the Recommendations
Authors: Greenwald Bruce , Stein Jeremy
Published: August 2012

This paper was prepared for the Symposium on the [October 1987] Stock Market Crash, held February 8, 1988, at Princeton University. The article provides a framework for thinking about the recommendations made by the Presidential Task Force on Market Mechanisms. Three conclusions can be drawn from the Task Force's findings: First, the proper focus of analysis of the events of the October crash should be on “market mechanisms” rather than on fundamental imbalances in the economy as a whole. Second, the instability evident in the events of October 1987 was not the inexorable limit of a steadily increasing level of day-to-day stock price volatility. Third, under the sorts of conditions that prevailed on late Monday and Tuesday, an orderly halt to trading (and subsequent orderly reopening) would have been preferable to what actually took place. We describe how the data collected by the Task Force leads us to these three broad conclusions.
Why Financial Structure Matters
Authors: Stiglitz Joseph E
Published: August 2012

[This is a comment on “The Modigliani-Miller Propositions after Thirty Years” by Merton H. Miller in this same issue.] The 1958 paper by Franco Modigliani and Merton Miller has been justly hailed as a landmark in the modern theory of finance. What has not been sufficiently emphasized is the importance of the paper to the development of economic theory and practice. Indeed, it is ironic that a paper which purportedly established that one need not pay any attention to financial structure -- that financial structure was irrelevant -- should have focused economists' attention on finance. Again ironically, some of the most productive responses to the MM results have come from those who did not feel able to accept the conclusion that financial policy is irrelevant. The MM results forced these skeptics to identify which of the assumptions underlying the MM theorem should be modified or rejected. The attention of economists during the past 30 years has focused on four assumptions underlying the model: first, that firms can be identified by “risk class”; second, that individual borrowing can substitute for firm borrowing; third, that investors have full information about the returns of the firm; and fourth -- the importance of which MM themselves recognized -- is that there are no taxes, or at least tax policy does not treat debt and equity differentially. The question has been not so much whether these assumptions are “realistic,” but whether, or under what circumstances, altering these assumptions leads to situations where financial structure does indeed matter.
MM—Past, Present, Future
Authors: Modigliani Franco
Published: August 2012

[This is a comment on “The Modigliani-Miller Propositions after Thirty Years” by Merton H. Miller in this same issue.] Before getting serious about the MM theorem's past and future, I would like to say a few words about its more personal history, including the origins of the Modigliani-Miller alliance. Miller has reviewed, in his usual masterly fashion, the validity and working of the MM theorem under conditions of perfect markets and no taxes. There seems little to add to that subject, especially since, by now, countless alternative proofs of the theorem have been provided. So I would like to come back to some issues that are still with us -- and probably will be for a long time. How should the MM propositions be modified in the presence of taxes and how well do they perform in accounting for observed behavior?
Theory versus Empiricism in Academic Economics: Update and Comparisons
Authors: Morgan Theodore
Published: August 2012

Six years ago, Wassily Leontief, a past president of the American Economic Association and Nobel Laureate, analyzed the kinds of articles published in the American Economic Review. He focused on the proportion of articles devoted to theory as compared to empirical analysis and criticized the discipline for an aversion to “systematic empirical inquiry.” I reproduce Leontief's tabulation of American Economic Review articles for 1972-76 and 1977-81, and then add new data covering the most recent five years, 1982-86. The question is: what changes are occurring in the proportions of theoretical articles and empirical articles? For comparison, I also consider levels and trends at the Economic Journal in Britain. Finally, I compare academic economics, from the above data for 1982-86, with two other U.S. social sciences and two U.S. physical sciences. The articles tabulated for the social and physical sciences are those appearing in the official journals of their associations.
Productivity Puzzles and R&D: Another Nonexplanation
Authors: Griliches Zvi
Published: August 2012

Around 1974-75, output growth and associated productivity measures dropped sharply in the United States and in most other western industrialized nations and continued at rather low rates for most of the rest of the 1970s. During the late 1960s, the growth in research and development (R&D) investment slowed down markedly (in constant dollars) and did not really recover until the late 1970s. Basic research was especially hard hit, showing a substantial absolute decline during the same period. Whether this slowdown in the investment in new technologies can account for the observed productivity slowdown is a fascinating question. I shall argue below that it cannot, at least not yet, since its effects take a long time to work themselves through the innovation and diffusion processes. The oil price hikes of the early and late 1970s and their macro-consequences are, therefore, the most likely direct causes of these pervasive declines in the growth rate of productivity.
The Corporate Bankruptcy Decision
Authors: White Michelle J
Published: August 2012

Economic theory suggests that bankruptcy should serve as a screening process designed to eliminate only those firms that are economically inefficient and whose resources could be better used in some other activity. However, firms typically file for bankruptcy voluntarily. When they do, creditors are not all repaid in full and large redistributional effects occur. Managers of firms do not take creditors' losses fully into account in deciding either how to run the firm or whether and when to file for bankruptcy. This suggests that firms in bankruptcy might not always be economically inefficient and that inefficient firms might not always end up in bankruptcy. The paper is divided into separate sections on bankruptcy liquidation and reorganization. In examining each of those topics, it will consider the features of an economically efficient bankruptcy procedure and how such a procedure might differ from actual U.S. bankruptcy law. In a concluding section, I consider the costs of bankruptcy and some proposed reforms. I argue that some deadweight losses are the unavoidable consequence of having a bankruptcy procedure and cannot be eliminated by reforming it. These deadweight losses are the price of having limited liability for corporate equity holders.
Puzzles: Love and Spaghetti, The Opportunity Cost of Virtue
Authors: Bergstrom Ted
Published: August 2012

In honor of St. Valentine's day, we offer a puzzle about love and a puzzle about virtue.