Automatic Stabilizer Research Articles

Design and Fabrication of Automatic Voltage Stabilizer using Relay-Based Tap Changing of Transformer

The growing demand for power, and fluctuations in the load present challenges for maintaining a stable and continuous voltage supply. A voltage stabilizer is an electrical appliance that is designed in such a way that it delivers a constant output voltage regardless of the variation in the input supply voltage. This research explores various measures aimed at stabilizing the voltage supply in the face of increasing power demand and fluctuations in load, to ensure a constant output voltage. To this end, a microcontroller-based Automatic Voltage Stabilizer is presented as a robust solution. A prototype of the device, with a power rating of 1kVA and operating at a frequency of 50 Hz, has been fabricated and includes components such as an autotransformer, relay board, voltage sensors, and an Arduino microcontroller. The autotransformer’s taping is adjusted in response to changes in the input voltage. Experimental results show that the prototype can effectively regulate the voltage output between 190V to 250V under a load of 300W.

Overcoming voltage fluctuation in electric vehicles by considering Al electrolytic capacitor-based voltage stabilizer

Battery pack used in electrical vehicles (EVs) have developed fastly nowadays and are important due to its capability to stores electric charge. However, it is still found that there is an electrical voltage fluctuations due to sudden load changes or faults in the power system. To overcome this problem, the conventional strategy focuses on using voltage stabilizer with inductor-capacitor resonant circuits, leaving the problem of using capacitors at cryogenic temperatures. Herewith, we design a vehicle automatic voltage stabilizer (VAVS) operating at room temperature. The VAVS consists of nine main components, including resistors, capacitors, transistors, and diodes arranged with a specific composition to stabilize the voltage. By considering Al electrolytic capacitor, type of diode, resistor, and transistor, the VAVS device stabilizes the input voltage from 10-15V to obtain an output voltage of 12V. Then, by varying the engine rotation speed of vehicle, VAVS applied in vehicle battery supplies a constant voltage of about 12.1 V. The lowest line regulation analysis reveals a regulated voltage fluctuation of 0.17%/V. Our result shows that VAVS design works at room temperature, overcomes the voltage fluctuation and complies with the standard regulation of voltage stabilizers.

Experience Rating as an Automatic Stabilizer

Experience Rating as an Automatic Stabilizer

Labor share as an "automatic stabilizer" of income inequality

We provide a new and unexplored explanation of the relationship between the functional and personal distribution of income. By proposing a simple theoretical framework, we show that, in the noncomprehensive personal income tax (PIT) hypothesis (i.e., when some or all capital income items are excluded from the PIT base), the correlation between disposable and market income inequality depends on the labor share level, which may influence the overall effectiveness of the tax-benefit system in addition to the PIT progressivity. We test our hypothesis using panel data on 33 OECD countries from 2000 to 2017 and find that a 10-pp increase in labor share is related to a 0.06 reduction in the correlation between market and disposable income inequality. This significant result obtained after controlling for country and year fixed effects, country-specific linear trends, and several confounders capturing the characteristics of the tax-benefit system suggests that labor share may act as an "automatic stabilizer" of market income inequality. Relevant implications for tax policy concern the role of the PIT's base for the public budget's overall redistributive effect.

On the control interaction of synchronous machine and inverter-based resources during system-split situations

Motivated by the potential transient oscillation risks in inverter based resource (IBR) dominated power systems, the paper is to identify the unwanted control interactions between traditional synchronous machines (SMs) and IBRs during system-split situations. Modal impedance analysis method is applied to reveal oscillation risk and the underlying mechanism, while electromagnetic transient (EMT) simulation analysis is used to observe reliable oscillation phenomenon. Impedance models of IBRs considering both grid-following (GFL) and grid-forming (GFM) control schemes and SMs equipped with automatic voltage regulator (AVR) and power system stabilizer (PSS) are developed for grid conditions with large frequency and/or voltage deviations, and validated by EMT simulations. Potential adverse control interactions within an exemplary test system are analyzed taking into account the impacts of: 1) renewable penetration level; 2) converter control scheme (GFL or GFM); 3) converter control tuning; 4) SM control setting; 5) grid-support capabilities of converter-interfaced loads. It has been observed that oscillation instability at around several Hz can occur by high penetration of GFL controlled IBRs after system-splits, which can be mitigated by redesigning the AVR & PSS control, or retuning the power/voltage control loops and phase-locked loop (PLL) of GFL converter. However, such measures might inevitably induce other stability issues, e.g. synchronization instability. From the oscillation analysis, it has also been revealed, through replacing part of the GFL converters with GFM converter(s), the oscillation mode at several Hz can disappear, owning to the varied impedance including better damping of GFM than GFL for the frequencies between 1 and 10 Hz.

"An Introduction to the European Union Unemployment Reinsurance System as Automatic Economic Stabilizer: Economic Policy and Management Recommendations"

A few months in, it is still hard to grasp the scale and scope of COVID-19’s global impact. A third of the world population is under some sort of “lockdown.” All the while, a second crisis, in the form of an economic recession, is underway (Schwab and Vanham, 2020). During the recession, European Union (EU) members did not use fiscal policies to ease the recession, while the reinsurance system in the case of unemployment would achieve exactly this, as it acts as an automatic stabilizer. The response to unemployment in the great recession and subsequent events related to the European debt crisis has been very heterogeneous across Europe and in population groups. This study examines stabilizing power and efficiency of presented unemployment reinsurance systems (URS EU). We find that the statutory contribution rate for unemployment insurance is sufficiently high only in a small part of the EU. Only certain insurance systems are sustainable. This paper demonstrates that the need for an automatic stabilizer, such as the reinsurance in the case of unemployment, has shown even more necessary. Through this paper and these recommendations, this study hopes to encourage institutional reforms, especially in the euro area, as the monetary union reduces macroeconomic stabilization policies at national level. We believe that the URS EU would represent a possible solution to the problems outlined in the paper.

The reserve option mechanizsm as an automatic stabilizer against capital flows: vector autoregressive (VAR) analysis

Purpose- a result of the quantitative easing policies implemented by the central banks of developed countries after the 2008 global financial crisis, a large amount of liquidity was poured into the financial markets. This situation has caused a rapid capital flow to the economies of developing countries. In order to prevent the risks that these short-term rapid capital flows may pose on macroeconomic and financial stability, the central banks of the developing countries and the Central Bank of the Republic of Turkey have applied to non-traditional monetary policies to combat these risks. The aim of this study is to analyze the relationship between the utilization rate of the Reserve Option Mechanism (ROM), which has been implemented by the CBRT since September 2011, and between capital movements and exchange rates. Methodology- The relationship between the ROM utilization rate, exchange rate and capital movements was analyzed using the vector autoregressive (VAR) model. Since there is no distinction between dependent and independent variables in VAR models, all of the variables are included in the model internally and their effects on each other are tested. Findings- are that both the exchange rate and the CDS, which is used to represent capital movements, react to a one-unit standard deviation shock in the usage rate of the ROM, which is aimed to act as a buffer against the volatility caused by capital flows. Conclusion- The ROM acts as an auto-balancer, but this balancing mechanism does not occur in a symmetrical manner. Keywords: Reserve option mechanism, capital mobility, VAR analysis JEL Codes: E44, G01, G32

Regional redistribution through SBA guaranteed loan programs

We document and quantify a new implicit transfer mechanism in the SBA 7(a) loan program that redistributes funds between US states. We use SBA 7(a) loan data in conjunction with Dealscan private corporate loan data to show that SBA 7(a) loan interest rates are much less responsive to predicted local loan default risk compared to private corporate loans. This redistributes funds from states with low default risk to states with high default risk. These transfers are positively correlated with the severity of local economic shocks during the Great Recession and the COVID-19 Recession. Therefore, even though it was unintended, the interest rates on SBA 7(a) loans acted as an automatic stabilizer mitigating regional economic shocks.

Defying the Odds: Remittances during the COVID-19 Pandemic

This paper provides an early assessment of the dynamics and drivers of remittances during the COVID-19 pandemic, using a newly compiled monthly remittance dataset for a sample of 52 countries, of which 16 countries have bilateral remittance data. The paper documents a strong resilience in remittance flows, notwithstanding an unprecedent global recession triggered by the pandemic. Using the local projection approach to estimate the impulse response functions of remittance flows during January 2020–December 2020, the paper provides evidence that: (i) remittances responded positively to COVID-19 infection rates in migrant home countries, underscoring its role as an important automatic stabilizer; (ii) stricter containment measures have the unintended consequence of dampening remittances; and (iii) a shift from informal to formal remittance channels due to travel restrictions appears to have also played a role in the surge in formal remittances. Lastly, the size of the fiscal stimulus in the host country is positively associated with remittance flows to migrants’ home country as the fiscal response cushioned the economic impact of the pandemic.

Financial Intermediation, Capital Accumulation, and Crisis Recovery

Abstract We integrate bank and bond financing into a two-sector neoclassical growth model and identify an automatic stabilization effect due to endogenous bank leverage adjustment. We show that although bank leverage amplifies shocks, the increase of leverage due to a decline in bank equity partially offsets the post crisis decline of bank lending and accelerates economic recovery by reducing the persistence of the bank lending channel. In this case, endogenous leverage adjustment is an automatic stabilizer. Regulatory state-independent capital limits and wage rigidities impair the re-allocation of capital between sectors and weaken this automatic stabilization. A quantitative analysis of the US during the Great Recession shows that the magnitude of automatic stabilization can be significant and informs about potentially high costs of strict capital regulation or wage rigidities during banking crises.

The Introduction of an eu Unemployment Reinsurance System: Income Protection and Maintenance of Consumption

The paper deals with the suitability of the introduction of unemploymentreinsurance in the countries of the European Union (URS EU) in terms ofmaintaining the level of consumption of the unemployed and promotingeconomic efficiency. Based on the literature review, the analysis of the usreinsurance system and the analysis of existing unemployment insurancein the EU, a model of the reinsurance system for unemployment in the EUis developed. The model simulation, based on the data of existing EU-20unemployment insurance systems in the period 2003–2019, is used to determinethe amount of reinsurance payments to countries and the levelof contributions needed, while employing various ways of defining paymenttriggers. We have demonstrated that the urs EU would contributeto better income protection by having a direct impact on the income of theunemployed and at the same time acting as an automatic stabilizer of theeconomy.

Poor Performance as a Predictable Outcome: Financing the Administration of Unemployment Insurance

Effective administration of unemployment insurance (UI) is central to its ability to smooth consumption and act as an automatic stabilizer. The federal government's method of allocating funds to administer UI gives the states no incentive to provide quality service at reasonable cost. We first document the deteriorating performance of the UI system in recent recessions and present estimates of a descriptive model relating state workloads to performance. We then characterize UI administration as a standard principal-agent problem, which leads to a method of allocating funds that would motivate states to adopt new technologies and improve performance.

The Macroeconomics of Government Spending: Distinguishing Between Government Purchases, Government Production, and Job Guarantee Programs

ABSTRACT This paper reconstructs the Keynesian income—expenditure (IE) model to include distinctions between government purchases of private sector output, government production, and government job guarantee program (JGP) employment. Analytically, including those distinctions transforms the model from a single sector model into a multi-sector model. It also surfaces the logic behind the automatic stabilizer property of JGP employment. The model is then extended to include Kaleckian income distribution effects which contribute to explaining why expenditure multipliers vary by type of fiscal expenditure. The Kaleckian version generates a new balanced budget multiplier driven by changed composition of government spending. It also illuminates some macroeconomic implications of privatization of government produced services.

Monetary and fiscal policy interactions in resource-rich emerging economies

ABSTRACT This paper investigates monetary-fiscal interactions in resource-rich emerging economies using an estimated Dynamic Stochastic General Equilibrium model. We find evidence of an active monetary and passive fiscal policy but confirm the presence of revenue substitution; a phenomenon that alters the automatic stabilizer’s role of fiscal policy. Once the response of fiscal policy to oil-related flows is muted, the revenue substitution effect is neutralized, taxes respond positively to debt, and the stagflationary impacts of negative oil price shocks are ameliorated. Our findings highlight the need for dynamic tax policies that are less sensitive to receipts from resource rent as a strategy for achieving debt sustainability and overall macroeconomic stability in resource-rich countries.

Experience Rating as an Automatic Stabilizer

Experience Rating as an Automatic Stabilizer

Experience Rating as an Automatic Stabilizer

Experience Rating as an Automatic Stabilizer

Currency substitution as an automatic stabilizer

AbstractIn the presence of frictions, the existing literature shows that currency substitution is detrimental for domestic aggregate stability. This paper singles out the role of currency substitution and shows that diversified currency holdings operate as an automatic stabilizer that mitigates belief-driven cyclical fluctuations in Farmer’s (1997) indeterminate monetary economy. When the foreign inflation rate is lower than the domestic inflation rate, the model’s steady state always displays saddle-path stability. Hence, equilibrium indeterminacy originally present in the domestic country is entirely removed in the presence of diversified currency holdings. When the foreign inflation rate is higher than the domestic inflation rate, then depending on the degrees of currency substitution and relative risk aversion, indeterminacy is either impossible or the requisite level of the foreign inflation rate for indeterminacy is too high to square with data. The stabilizing effect of diversified currency holdings on domestic aggregate stability is robust to whether domestic and foreign currencies display as Edgeworth substitutes or complements, or are additively separable in the household’s preferences.

Leaning against the Bubble: Central Bank Intervention in Walrasian Asset Markets

The paper presents a two-period Walrasian financial market model composed of informed and uninformed rational investors, and noise traders. The rational investors maximize second period consumption utility from the payoffs of trading risk-free holdings to risky assets in the first period. The central bank reacts directly to asset price movements by selling or buying assets to stabilize the market price. It is found that the intervention makes the risky asset’s market price per share less sensitive to information shocks, which presses the market price towards its average price thus reducing price variance. The informed investors’ prediction coefficient remains unaffected, but that of the uninformed investors is magnified, which cancels out the negative effect on shock sensitivity thus keeping the expected value of the risky asset’s dividend constant. Finally, the introduction of the policy rule does not affect rational investors’ risk per share. A general conclusion is that the central bank’s policy can be regarded as an effective automatic stabilizer of financial markets.

Employer of Last Resort as a new ‘New Deal’: A few thoughts on Turkey

Modern Monetary Theory emerges as a plausible alternative to solve Turkey’s staggering unemployment problem. This proposed solution here is the introduction of job guarantee program, which produces a non-discretionary automatic stabilizer that fosters both price stability and full employment. As a monetary sovereign, Turkey has the capacity to use deficit spending to bring growth and provide full employment to the millions who are in involuntary unemployment. The goal here is to tame the business cycles without throwing millions into unemployment, which has social and economic ramifications. In the absence of job creation by the private sector, this can be achieved through the use of government, providing job guarantees and the state acting as an employer of last resort by creating public projects, which will be cyclically adjusted in order to achieve full employment. 

ADAPTATION TO EXTERNAL SHOCKS WITHIN THE CURRENCY BOARD SYSTEM ON THE EXAMPLE OF THE BALTIC COUNTRIES AND BOSNIA AND HERZEGOVINA

One of the most important economic policy issues, especially in the post-transition countries, is exchange rate regime (ERR), i.e. the question of optimal exchange rate regime that would stimulate economic growth and propagate macroeconomic stability. For small and EU-oriented countries like Bosnia and Herzegovina (B&H), the EU accession processes and character of countries' economic cycle phase are usually highlighted among many factors. The choice of the appropriate exchange rate system is determinated by the specific characteristics of individual countries, time moment and the characteristics of the external shock occurrence. It is generally accepted that monetary instabilities are treated by fixation and real economic shocks by exchange rate fluctuations. An important criterion for assessing the adequacy of the current exchange rate regime is its response to external shocks, such as the Great Recession in 2008. While flexible exchange rate regime is used as an automatic stabilizer, fixed exchange rates place certain restrictions. The process of macroeconomic adjustment in the Baltic States is an example of how large macroeconomic imbalances can be reduced without adjusting the nominal exchange rate and how the currency board can be successfully used as a stage in the euro introduction process. The aim of this paper is to give a comparative overview of the currency board introduction in Bosnia and Herzegovina and the Baltic countries, results achieved and reactions to external shocks (Great Recession in 2008) within this exchange rate arrangement, so conclusions that could be valuable in post-COVID 19 recovery can be drawn. Key words: exchange rates, currency board, external shocks