Equilibrium Effects Research Articles

Thermal stress and financial distress: Extreme temperatures and firms’ loan defaults in Mexico

The frequency and intensity of extreme temperature events are likely to increase with climate change. Using a detailed dataset containing information on the universe of loans extended by commercial banks to private firms in Mexico, we examine the relationship between extreme temperatures and credit performance. We find that unusually hot days increase delinquency rates, primarily affecting the agricultural sector, but also non-agricultural industries that rely heavily on local demand. Our results are consistent with general equilibrium effects originated in agriculture that expand to other sectors in agricultural regions. Additionally, following a temperature shock, affected firms face increased challenges in accessing credit, pay higher interest rates, and provide more collateral, indicating a tightening of credit during financial distress.

Clinical Dilemma Involving Treatments for Very Low-Birth-Weight Infants and the Potential Risk of Necrotizing Enterocolitis: A Narrative Literature Review.

Necrotizing enterocolitis (NEC) is a critical gastrointestinal emergency with substantial morbidity and mortality risks, especially for very low-birth-weight (VLBW) infants, and unclear multifactorial pathophysiology. Whether common treatments for VLBW infants increase the NEC risk remains controversial. Indomethacin (utilized for patent ductus arteriosus) offers benefits but is concerning because of its vasoconstrictive impact on NEC susceptibility. Similarly, corticosteroids used to treat bronchopulmonary dysplasia may increase vulnerability to NEC by compromising immunity and altering the mesenteric blood flow. Histamine-2 receptor blockers (used to treat gastric bleeding) may inadvertently promote NEC by affecting bacterial colonization and translocation. Doxapram (used to treat apnea) poses a risk of gastrointestinal disturbance via gastric acid hypersecretion and circulatory changes. Glycerin enemas aid meconium evacuation but disrupt microbial equilibrium and trigger stress-related effects associated with the NEC risk. Prolonged antibiotic use may unintentionally increase the NEC risk. Blood transfusions for anemia can promote NEC via interactions between the immune response and ischemia-reperfusion injury. Probiotics for NEC prevention are associated with concerns regarding sepsis and bacteremia. Amid conflicting evidence, this review unveils NEC risk factors related to treatments for VLBW infants, offers a comprehensive overview of the current research, and guides personalized management strategies, thereby elucidating this clinical dilemma.

He abundance in NGC 1850 A and B: Are we observing the early stage of the formation of multiple populations in a stellar cluster?

ABSTRACT We present the results for a sample of B stars in the Large Magellanic Cloud young double stellar cluster NGC 1850 A and NGC 1850 B, as observed with the integral-field spectrograph at the Very Large Telescope, the Multi Unit Spectroscopic Explorer (MUSE). We compare the observed equivalent widths (EWs) of four He lines (4922, 5015, 6678, and 7065 Å) with those determined from synthetic spectra computed with different He mass fractions (Y = 0.25, 0.27, 0.30, and 0.35) with the code synspec, which takes into account the non-local thermodynamic equilibrium effect. From this comparison, we determine the He mass fraction of the B stars, finding a distribution that is not homogeneous. The stars can be divided in three groups: He-weak (Y < 0.24) and He-normal (0.24 ≤ Y ≤ 0.26) stars, belonging to the main sequence of NGC 1850 A, and He-rich stars (0.33 ≤ Y ≤ 0.38), situated in the main sequence associated with NGC 1850 B. We analyse the stellar rotation as possibly being responsible for the anomalous features of the He lines in the He-rich stars. We provide a simple analysis of the differences between the observed EWs and those obtained from theoretical models with different rotation velocities (Vsini = 0 and 250 km s–1). The resolution of the MUSE spectra does not allow us to obtain a conclusive result; however, our analysis support the He-enhanced hypothesis.

The perverse equilibrium effects of state and federal student aid in higher education

Reflecting the ongoing public concern about strategic behavior among colleges, we develop a game-theoretic higher education model with peer effects to examine the equilibrium market response to changes in state and federal student aid. In addition to establishing perfect equilibrium existence, we find that state and federal student aid programs are vulnerable to equilibrium effects that conflict with the intended impact of policy instruments. For instance, even when college objectives are devoid of selfish intent, strict increases in state and federal student aid can induce decreased student access to higher education or even increased financial strain from college enrollment.

Fluorescence of p-hydroxyazobenzocrowns – Tautomeric equilibrium effect

The spectroscopic properties of a series of para-hydroxyazobenzocrowns, including three novel compounds, were investigated using UV–Vis absorption and emission spectroscopy. This study presents, for the first time, determined quantum yield (QY) values for macrocycles of this category, ranging between 0.122 and 0.195. The highest values were obtained for crowns bearing two phenyl substituents in benzene rings. The impact of aromatic ring substituents and macroring size on the spectral characterization (1H NMR and FTIR) of p-hydroxyazobenzocrowns was examined in consideration of the azophenol ⇄ quinone-hydrazone tautomeric equilibrium. Dipole moments of p-hydroxyazobenzocrowns in the ground and excited states have been determined. The alignment between experimental findings and theoretical studies was established.

The environmental impacts of protected area policy

The world has pledged to protect 30 percent of its land and waters by 2030 to halt the rapid deterioration of critical ecosystems. We summarize the state of knowledge about the impacts of protected area policies, with a focus on deforestation and vegetation cover. We discuss critical issues around data and measurement, identify the most commonly-used empirical methods, and summarize empirical evidence across multiple regions of the world. In most cases, protection has had at most a modest impact on forest cover, with stronger effects in areas that face pressure of economic development. We then identify several open areas for research to advance our understanding of the effectiveness of protected area policies: the use of promising recent econometric advancements, shifting focus to direct measures of biodiversity, filling the knowledge gap on the effect of protected area policy in advanced economies, investigating the long-run impacts of protection, and understanding its equilibrium effects.

General Equilibrium Effects of the Adoption of a Dual-Class Share Structure by an Innovative Firm in Korea

ABSTRACT This study examines the general equilibrium effects of the adoption of a dual-class share structure by an innovative firm in Korea. In contrast to previous studies, which are performed from a microeconomic perspective and focus on empirical analyses, this study is performed from a macroeconomic perspective and uses a theoretical approach based on a dynamic general equilibrium model. The calibrated results obtained using data from Korea show that the adoption of a dual-class share structure by an innovative firm increases real gross domestic product, total real consumption, social welfare, and total innovation ability by 0.63%, 1.23%, 1.23%, and 2.22%, respectively, but decreases the probability of failure to defend management rights by 6.44%. In contrast, the adoption of a dual-class share structure by a non-innovative firm has a much weaker effect because a non-innovative firm does not invest in innovation.

Mass transfer in atmospheric water harvesting systems

In this work, the rate-limiting diffusion mechanisms of MOF-303, MOF-333, and a multivariate (MTV) version of these metal–organic frameworks (MOFs), where the organic linkers are present in a 50/50 ratio, are identified and quantified using concentration swing frequency response (CSFR). The data show that the single-atom precision of MOFs allows for precise tuning of the diffusion rate that is not easily achieved in traditional adsorbent materials. The Maxwell-Stefan diffusivity as a function of loading was calculated to decouple the influence of molecular mobility and equilibrium effects. To further understand the diffusion process in these MOFs, samples with different crystal sizes were synthesized and diffusion rates were measured. The results show that the controlling diffusion length scale is similar between the small and large crystal samples, as evidenced by similar diffusion rate constants. The MOFs were then incorporated into a film using a binder system and the mass transfer mechanisms were identified using CSFR. When placed in this particular binder system, the macropore diffusion behavior dominates over the MOF micropore diffusion. To illustrate how these diffusion parameters govern the adsorption rates and dynamics of water-harvesting systems, a model of the MOF-coated tube was developed. The results show that, with only milligrams of adsorbent, CSFR can quantify the diffusion rate needed to predict the adsorption times in a water-harvesting system. More broadly, the results illustrate the connectivity between atomically-precise reticular chemistry and water-harvesting system performance.

Capital Regulation and Shadow Finance: A Quantitative Analysis

Abstract This article studies the effects of higher bank capital requirements. Using new firm-lender matched credit data from South Korea, we document that Basel III coincided with a 25% decline in credit from regulated banks, and an increase of similar magnitude from non-bank (shadow) lenders. We use our data to estimate the effect of capital requirements on bank credit, and the spillover effect of the reform on non-bank lending. We then build a general equilibrium model with heterogeneous banks and firms that replicates these micro estimates. We find that Basel III can account for most of the observed decrease in regulated bank lending and about three quarters of the increase in shadow lending. The latter is driven exclusively by general equilibrium effects of the reform.

Trade-ins and Transaction Costs in the Market for Used Business Jets

Manufacturers of durable goods can encourage consumers facing transaction costs to upgrade by accepting used units as trade-ins. These “buyback schemes” increase demand for new units, but increase the supply of used units if trade-ins are resold. I investigate the equilibrium effects of buyback schemes in the market for business jets. I find that buyback increases manufacturer revenue by 7.2 percent at fixed prices. However, in equilibrium this revenue gain is diminished by 43 percent due to substitution away from new jets among first time buyers. I show how the size of this cannibalization effect depends on preference heterogeneity. (JEL D23, G34, L13, L62)

NLTE Analysis of High-Resolution H-Band Spectra, V: Neutral Sodium

In order to derive sodium abundances and investigate the effects of non-local thermodynamic equilibrium (NLTE) on the formation of H-band Na I lines, we update the sodium atomic model by incorporating collision rates with hydrogen from new quantum-mechanical calculations. The differential Na abundances for 13 sample stars are obtained by analyzing high-resolution H-band spectra from the Apache Point Observatory Galactic Evolution Experiment (APOGEE) and optical spectra under both local thermodynamic equilibrium (LTE) and NLTE conditions. Consistent abundances from both bands suggest that our updated atomic model is valid for studying the formation of H-band Na I lines. Our calculations show that, in our stellar parameter space, NLTE effects are negative and can result in corrections larger than −0.4 dex on optical lines. The corrections on H-band Na I lines are typically small, within about 0.05 dex, but not negligible if accurate sodium abundance is desired. We note that the [Na/Fe] ratios favor the theoretical galactic chemical model.

Exploration of non-resonant divertor features on the Compact Toroidal Hybrid

Non-resonant divertors (NRDs) separate the confined plasma from the surrounding plasma facing components (PFCs). The resulting striking field line intersection pattern on these PFCs is insensitive to plasma equilibrium effects. However, a complex scrape-off layer (SOL), created by chaotic magnetic topology in the plasma edge, connects the core plasma to the PFCs through varying magnetic flux tubes. The Compact Toroidal Hybrid (CTH) serves as a test-bed to study this by scanning across its inductive current. Simulations observe a significant change of the chaotic edge structure and an effective distance between the confined plasma and the instrumented wall targets. The intersection pattern is observed to be a narrow helical band, which we claim is a resilient strike line pattern. However, signatures of finger-like structures, defined as heteroclinic tangles in chaotic domains, within the plasma edge connect the island chains to this resilient pattern. The dominant connection length field lines intersecting the targets are observed via heat flux modeling with EMC3-EIRENE. At low inductive current levels, the excursion of the field lines resembles a limited plasma wall scenario. At high currents, a private flux region is created in the area where the helical strike line pattern splits into two bands. These bands are divertor legs with distinct SOL parallel particle flow channels. The results demonstrate the NRD strike line pattern resiliency within CTH, but also show the underlying chaotic edge structure determining if the configuration is diverted or limited. This work supports future design efforts for a mechanical structure for the NRD.

Impact of agricultural input subsidy policy on market participation and income distribution in Africa: A bottom-up/top-down approach

Previous literature on the effects of agricultural input subsidy programs on smallholder market participation has only focused on partial equilibrium analysis, while ignoring important general equilibrium effects. Therefore, this study fills this gap by highlighting the critical role of targeting in the implementation of the agricultural input policy in the Malawian context. Specifically, we establish a bi-directional link between a farm household model and a general equilibrium model in order to explore the spillover effects of the input policy on market orientation and income distribution. Based on the findings, the partial equilibrium analysis underestimates the effect of the input policy and neglects important heterogeneities between farmers. More importantly, we find that extending the program to farmers who are excluded from the cereal and/or labor markets can lead to higher market participation, economic growth, and a reduction in poverty. Our findings suggest better targeting to increase the impact of agricultural input policy on market participation.

The general equilibrium effects of localised technological progress: A Classical approach

We study the general equilibrium effects of localised technical progress à la Atkinson–Stiglitz in economies in which capital is a vector of reproducible and heterogeneous goods. We show that there is no obvious relation between ex-ante profitable innovations and the functional distribution of income that actually emerges in equilibrium. Unlike in the standard macroeconomic approach to technical progress, localised innovations may lead to indeterminacy in equilibrium factor prices, and individually rational choices of technique do not necessarily lead to optimal outcomes. Innovations may even cause the disappearance of all equilibria.

Flexible time horizon planning, learning and aggregate fluctuations

A dynamic general equilibrium model is constructed and analyzed under the assumptions that the representative decision maker is endowed with incomplete knowledge about his environment of interest along with limited cognitive skills. Under various beliefs about the long-run growth prospects consistent with Kaldor's, 1961 stylized facts, the benchmark infinite-dimensional decentralized planning problem collapses into infinite sequences of T>1 dimensional sub-problems which are each within the decision maker's limited computing range. Based on the time length of the planning horizon and the nature of expectations, the resulting framework in which both forecasts and plans may get revised in the light of new information encompasses at the limits the benchmark infinite horizon case with perfect foresight, a rolling infinite horizon case, a self-fulfilling static planning case and Day's, 1969 two-period heuristic case. Under exogenous price and quantity growth forecasts consistent with the perfect foresight steady-state balanced growth path, the time length of the planning horizon may have no effect on the resulting competitive equilibrium which may deviate dramatically from the optimal solution. When these growth forecasts are endogenous, the competitive equilibrium effects of the planning horizon time length depend on the characteristics of the information sets. The resulting model may help us to better understand how economies respond to shocks by unraveling new propagation mechanisms related to changes in optimism or pessimism about short-run and/or long-run growth prospects.

Quantifying the partial and general equilibrium effects of sanctions on Russia

AbstractThis paper evaluates the effects of sanctions on Russia between 2014 and 2019 and the resulting countersanctions. We estimate their impact on trade in a gravity framework, allowing for treatment heterogeneity among pairs and sectors, and use the estimated elasticities in a general equilibrium analysis. We find that the sanctions decreased trade with Russia in key sectors, translating to a loss in real income in Russia by 0.3%. Full decoupling of the EU and its allies from Russia would increase this effect to over 4%. Our results emphasize the role of deep sanctions as a foreign policy instrument and international cooperation.

Macroeconomic consequences of alternative reforms to the health insurance system in the United States

AbstractThis paper presents a dynamic general equilibrium model designed to examine the macroeconomic effects and welfare implications of alternative reforms to the US health insurance system. Specifically, it scrutinizes the extent to which health care reform can mitigate inefficiencies stemming from market imperfections in the health insurance industry. The model considers a stochastic overlapping generations framework, incorporating heterogeneous agents who are subject to uncertain health shocks. These individuals make optimal decisions regarding labor supply, health insurance, and medical services. Given that the optimal levels of medical consumption and hours worked are endogenous, this setting encapsulates general equilibrium effects. The model is calibrated to US data, and numerical simulations suggest that suitable adjustments to the present health insurance system can broaden coverage and enhance welfare. This improvement is achieved by reducing adverse selection, improving overall health status, and lessening tax distortions on labor supply.

Optical force conversion and conveyor belt effect with coupled graphene plasmon waveguide modes.

We propose a double-layer graphene sheets side coupling to a strip of graphene to obtain the optical pulling or pushing force. Combined with coupled mode theory and finite-difference time-domain simulations, it is found that the conveyor belt effect can be realized in conjunction with the lateral optical equilibrium effect upon the radiation loss κe equal to the intrinsic loss κo. The maximum total optical force acting on the strip in the symmetric mode (S-mode) can be up to ∼5.95 in the unit of 1/c and the anti-symmetric (AS-mode) mode reach ∼2.75 1/c. The optical trapping potential Ux and optical trapping force Fx for the S-mode have a value around -22.5 kBT/W and 240 pN/W, while for the AS-mode can up to ∼-56 kBT/W and 520 pN/W, respectively. Our work opens a new avenue for optical manipulation with potential applications in optoelectronic devices and lab-on-a-chip platforms.

The nature, detection, and avoidance of harmful discrimination in criminal justice

AbstractWe provide a selective survey of the literature on discrimination by criminal justice agents, and argue for a taxonomy of harms that differs from conventional approaches. Discrimination can be self‐defeating if it reduces welfare among targets of discrimination while serving no legitimate purpose for the discriminating party. Even if a legitimate purpose is served, discrimination can be deliberative or demeaning, resulting in welfare losses that need to be accounted for. Deliberative and demeaning discrimination can also be self‐defeating through general equilibrium effects on witness cooperation, clearance rates, and preemptive and retaliatory violence. We consider how harmful discrimination can be detected and avoided, as well as changes in our understanding of discrimination resulting from the proliferation of predictive algorithms.

The governance of regional innovation policy and its economic implications

This paper provides insights on the potential macroeconomic impact of the governance of the European innovation policy called Smart Specialisation. We use original empirical data on the implementation of the policy, which is funded through a dedicated financial envelope of the 2014–2020 EU cohesion policy, in a spatial macroeconomic modelling framework capable of gauging the general equilibrium effects of varying degrees of governance quality. Our contribution aims at narrowing the gap between the abstraction of ex-ante impact assessment exercises based on macroeconomic simulations and the reality of how policy interventions may take place. By using data for all Italian NUTS 2 regions, we find that the measured quality of Smart Specialisation governance could increase the pure investment-related impact of the policy by up to 40 percent. At the same time, we estimate that further potential GDP gains—in the order of an additional 40–50 percent over what was achieved with the observed levels of governance—would not materialise because of the comparatively low quality of governance in some regions.