The core difficulty in developmental dyslexia across languages is a “phonological deficit”, a specific difficulty with the neural representation of the sound structure of words. Recent data across languages suggest that this phonological deficit arises in part from inefficient auditory processing of the rate of change of the amplitude envelope at syllable onset (inefficient sensory processing of rise time). Rise time is a complex percept that also involves changes in duration and perceived intensity. Understanding the neural mechanisms that give rise to the phonological deficit in dyslexia is important for optimising educational interventions. In a three-deviant passive ‘oddball’ paradigm and a corresponding blocked ‘deviant-alone’ control condition we recorded ERPs to tones varying in rise time, duration and intensity in children with dyslexia and typically developing children longitudinally. We report here results from test Phases 1 and 2, when participants were aged 8–10 years. We found an MMN to duration, but not to rise time nor intensity deviants, at both time points for both groups. For rise time, duration and intensity we found group effects in both the Oddball and Blocked conditions. There was a slower fronto-central P1 response in the dyslexic group compared to controls. The amplitude of the P1 fronto-centrally to tones with slower rise times and lower intensity was smaller compared to tones with sharper rise times and higher intensity in the Oddball condition, for children with dyslexia only. The latency of this ERP component for all three stimuli was shorter on the right compared to the left hemisphere, only for the dyslexic group in the Blocked condition. Furthermore, we found decreased N1c amplitude to tones with slower rise times compared to tones with sharper rise times for children with dyslexia, only in the Oddball condition. Several other effects of stimulus type, age and laterality were also observed. Our data suggest that neuronal responses underlying some aspects of auditory sensory processing may be impaired in dyslexia.
This study applies financial portfolio theory to determine efficient frontiers in the provision of electricity for the United States and Switzerland. Expected returns are defined by the rate of productivity increase of power generation (adjusted for external costs), volatility, by its standard deviation. Since unobserved productivity shocks are found to be correlated, Seemingly Unrelated Regression Estimation (SURE) is used to filter out the systematic component of the covariance matrix of the productivity changes. Results suggest that as of 2003, the feasible maximum expected return (MER) electricity portfolio for the United States contains more Coal, Nuclear, and Wind than actual but markedly less Gas and Oil. The minimum variance (MV) portfolio contains markedly more Oil, again more Coal, Nuclear, and Wind but almost no Gas. Regardless of the choice between MER and MV, U.S. utilities are found to lie substantially inside the efficient frontier. This is even more true of their Swiss counterparts, likely due to continuing regulation of electricity markets.
This paper reconsiders the role of monetary policy in Sweden’s strong recovery from the Great Depression. The Riksbank in the 1930s is sometimes seen as an example of a central bank that was relatively innovative in terms of the conduct of monetary policy. To consider this analytically, we estimate a small-scale, structural general equilibrium model of a small open economy using Bayesian methods. We find that the model captures the key dynamics of the period surprisingly well. Importantly, our findings suggest that Sweden avoided the worst excesses of the depression by conducting conservative rather than innovative monetary policy. We find that, by keeping the Swedish krona undervalued to replenish foreign reserves, Sweden’s exchange rate policy unintentionally contributed to the Swedish growth miracle of the 1930s, avoiding a major slump in 1932 and enabling the country to benefit quickly from the eventual recovery of world demand.
Recent developments on international financial markets have called the benefits of
bank globalization into question. Large, internationally active banks have
acquired substantial market power, and international activities have not
necessarily made banks less risky. Yet, surprisingly little is known about the
actual link between bank internationalization, bank risk, and market power.
Analyzing this link is the purpose of this paper. We jointly estimate the
determinants of risk and market power of banks, and we analyze the effects of
changes in terms of the number of foreign countries (the extensive margin) and
the volume of foreign assets (the intensive margin). Our paper has four main
findings. First, there is a strong negative feedback effect between risk and market
power. Second, banks with higher shares of foreign assets, in particular those held
through foreign branches, have higher market power at home. Third, holding
assets in a large number of foreign countries tends to increase bank risk. Fourth,
the impact of internationalization differs across banks from different banking
groups and of different size.
Modern trade theory emphasizes firm-level productivity differentials to explain
the cross-border activities of non-financial firms. This study tests whether a
productivity pecking order also determines international banking activities. Using
a novel dataset that contains all German banks’ international activities, we
estimate the ordered probability of a presence abroad (extensive margin) and the
volume of international assets (intensive margin). Methodologically, we enrich the
conventional Heckman selection model to account for the self-selection of banks
into different modes of foreign activities using an ordered probit. Four main
findings emerge. First, similar to results for non-financial firms, a productivity
pecking order drives bank internationalization. Second, only a few non-financial
firms engage in international trade, but many banks hold international assets, and
only a few large banks engage in foreign direct investment. Third, in addition to
productivity, risk factors matter for international banking. Fourth, gravity-type
variables have an important impact on international banking activities.
We study international business cycles and capital flows in the UK, the United States and the Emerging Periphery in the period 1885-1939. Based on the same set of parameters, our model explains current account dynamics under both the Classical Gold Standard and during the Interwar period. We interpret this as evidence for Gold Standard mentality: the expectation formation mechanism with respect to major macroeconomic variables driving the current account – output, exchange rates and interest rates – has remained fundamentally stable between the two periods. Nonetheless, the macroeconomic environment changed: Volatility increased generally, but less so for international capital flows than for GDP. This pattern is consistent with shocks in the Interwar period becoming more persistent and more global.
I study the effect of fatigue and innate ability on performance in a model with incomplete contracts, lumpy tasks requiring multiple periods of work and stochastic productivity shocks. I find that increasing ability or reducing fatigue does not lead necessarily to more productive efficiency, since it may exacerbate the incentive for agents take "too much" on-the-job leisure. In a world with heterogenous agents, the problem may be ameliorated by the introduction of a dual labour market with free-lancers (who can take breaks at their discretion) and regular workers (who work on a fixed schedule).
Several European countries have followed the United States in introducing prospective payment for hospitals with the expectation of achieving cost efficiency gains. This article examines whether theoretical expectations of cost efficiency gains can be empirically confirmed. In contrast to previous studies, the analysis of Switzerland provides a comparison of a retrospective per diem payment system with a prospective global budget and a payment per patient case system. Using a sample of approximately 90 public financed Swiss hospitals during the years 2004 to 2009 and Bayesian inference of a standard and a random parameter frontier model, cost efficiency gains are found, particularly with a payment per patient case system. Payment systems designed to put hospitals at operating risk are more effective than retrospective payment systems. However, hospitals are heterogeneous with respect to their production technologies, making a random parameter frontier model the superior specification for Switzerland.
Am Beispiel des Untergangs der Lusitania und der Titanic wird analysiert, ob und in welchem Maße finanzielle und physische Macht sowie soziale Normen über Leben und Tod entscheiden. In einem quasi-natürlichen Experiment werden multivariate Probit-Schätzungen von öffentlich verfügbaren Sekundärdaten der Schiffsuntergänge durchgeführt. Die Analyse kommt zum Ergebnis, dass es im Wesentlichen von der Zeitspanne zwischen der Beschädigung des Schiffes und seinem Untergang abhängt, welche Rolle physische Stärke, gesellschaftlicher Status oder soziale Normen in lebensbedrohenden Situationen spielen. In zeitlich eng begrenzten Extremsituationen verdrängen Angst und Stress wertbezogenes, rationales Handeln. Es kommt zu einem rücksichtslosen Kampf ums eigene Überleben. Bleibt jedoch in Empfinden und Wahrnehmung der Betroffenen ein größerer Zeitraum bis zum endgültigen Versinken des Schiffes, bestimmen in stärkerem Maße soziale und ethische Werte das Verhalten der Menschen.
