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- TestbankU
- TestbankU

... conditions in each market. As funds leave a country with low interest rates, this places upward pressure on that country’s interest rates. The international flow of funds caused this type of reaction. 14. Impact of War. A war tends to cause significant reactions in financial markets. Why would a war ...
Optimal Policy with Endogenous Signal Extraction
Optimal Policy with Endogenous Signal Extraction

... (2007, 2011) derive an ”endogenous Kalman filter” for all these cases which is equivalent to the solution of a standard Kalman filter of a parallel problem where all the states and the measurement are fully exogenous. The only exception to the separation principle is Svensson and Woodford (2004) wh ...
Foreign Direct Investment and Foreign Portfolio Investment
Foreign Direct Investment and Foreign Portfolio Investment

NBER WORKING PAPER SERIES COMPETING LIQUIDITIES: CORPORATE SECURITIES, REAL BONDS AND BUBBLES
NBER WORKING PAPER SERIES COMPETING LIQUIDITIES: CORPORATE SECURITIES, REAL BONDS AND BUBBLES

... The economy can be described recursively with one state variable: past investment it−1 . At date t + 1, given past investment it−1 , current investment it and the interest rate rt+1 are jointly determined by the intersection of a supply and a demand equation for assets. That these two curves interse ...
Ageing and asset prices, August 2010
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... These empirical studies can be divided into two main groups: (1) single country investigations of financial asset and house prices; and (2) international studies of financial asset prices. Identification is challenging in both case, which prompted this research to use an international sample of hous ...
Soft Landings (February 2000), with Martin Schneider
Soft Landings (February 2000), with Martin Schneider

... strong investment growth, especially in traditionally risky sectors.2 In addition, many recent financial crises were preceded by lending booms.3 A large literature now argues that lending booms are the result of mistaken government policy: the existence of bailout guarantees creates a moral hazard p ...
World of Work Report 2013: Repairing the economic and social
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... stimulate aggregate demand without dampening employment in developing countries? What is the scope in these countries for counteracting a double dip in growth and employment in advanced economies? • How can productive investment be stimulated in order to create more and better jobs? And what are the ...
Fiscal Monitor - Addressing Fiscal Challenges to Reduce Economic
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The Facts on Medicare Spending and Financing

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APEC Meeting Documents - APEC Meeting Document Database
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inflation-protected bonds: a look at the new i bond series
inflation-protected bonds: a look at the new i bond series

... bonds. I bonds thus provide “downside” protection to their holders. The downside to these bonds is that holders forego opportunities to have price gains and high returns if market interest rates were unexpectedly to fall. In addition, the yields are on average lower than can be obtained from other t ...
NBER WORKING PAPER SERIES HUMAN CAPITAL FORMATION WITH ENDOGENOUS CREDIT CONSTRAINTS
NBER WORKING PAPER SERIES HUMAN CAPITAL FORMATION WITH ENDOGENOUS CREDIT CONSTRAINTS

... little incentive to repay loans and, consequently, face more stringent constraints. Human capital theory indicates that the more able an individual and the more he invests in his skills, the more earnings potential he will possess. In an efficient credit market, he should, therefore, be allowed to b ...
Large changes in fiscal policy: taxes versus spending.
Large changes in fiscal policy: taxes versus spending.

... inequality, not so much about the size of fiscal multipliers, both sides also wish to "sell" their prescription as growth enhancing and more so than the other policy. Unfortunately both sides can’t be right at the same time! As far as reduction of large public debts the lesson from history is reason ...
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Stagnation nation? Australian investment in a low

... But the Australian economy has grown more slowly since the crisis. The potential growth rate of the economy has fallen, as discussed in Chapter 3. Lower productivity growth dragged down potential growth in the mid-2000s, and the Australian working-age population share has fallen by about a quarter o ...
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Pensions crisis

The pensions crisis is a predicted difficulty in paying for corporate, state, and federal pensions in the United States and Europe, due to a difference between pension obligations and the resources set aside to fund them. Shifting demographics are causing a lower ratio of workers per retiree; contributing factors include retirees living longer (increasing the relative number of retirees), and lower birth rates (decreasing the relative number of workers, especially relative to the Post-WW2 Baby Boom). There is significant debate regarding the magnitude and importance of the problem, as well as the solutions.For example, as of 2008, the estimates for the underfunding of U.S. states' pension programs range from $1 trillion using the discount rate of 8% to $3.23 trillion using U.S. Treasury bond yields as the discount rate. The present value of unfunded obligations under Social Security as of August 2010 was approximately $5.4 trillion. In other words, this amount would have to be set aside today such that the principal and interest would cover the program's shortfall between tax revenues and payouts over the next 75 years.Some economists question the concept of funding, and, therefore underfunding. Storing funds by governments, in the form of fiat currencies, is the functional equivalent of storing a collection of their own IOUs. They will be equally inflationary to newly written ones when they do come to be used.Reform ideas are in three primary categories: a) Addressing the worker-retiree ratio, via raising the retirement age, employment policy and immigration policy; b) Reducing obligations via shifting from defined benefit to defined contribution pension types and reducing future payment amounts (by, for example, adjusting the formula that determines the level of benefits); and c) Increasing resources to fund pensions via increasing contribution rates and raising taxes.
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