15 March 2013
Natural gas is a clean, abundant, and highly-efficient source of energy. When Resul Cesur
, Erdal Tekin
, and Aydogan Ulker
analyze variation in the expansion of natural gas infrastructure in Turkish provinces between 2001 and 2011, they find that the increased use of natural gas has resulted in a significant reduction in the rate of infant mortality in Turkey. They estimate that a one-percentage point increase in the rate of subscriptions to natural gas services could cause the infant mortality rate to decline by 4 percent in Turkey.
14 March 2013
and Gordon Dahl
analyze responses to a series of questions posed to a distinguished panel of economists that were designed to determine the degree to which economists agree or disagree about key economic questions. They find a broad consensus on many different economic issues, and they find it difficult to explain observed differences using obvious characteristics of the panel members, such as their current institutional affiliation, or the university from which they received their Ph.D. The authors do find that men who participated in the panel were slightly more likely to express an opinion on any given question than were women.
13 March 2013
analyzes data on exchange rates between the dollar, pound, euro, and yen and finds a structural relationship between the nominal exchange rate, national price levels, and the observed yields on long maturity inflation-indexed bonds. He interprets this as a fair value relationship between exchange rates that must prevail across economies in which inflation-indexed bonds are traded. He also shows that a 1 percent rise in the foreign currency risk premium relative to the dollar is associated with a 50-basis point rise in the inflation-indexed bond return differential in favor of the foreign country and a 50-basis point appreciation of the dollar.
12 March 2013
In order to study the relationship between stock prices and news, Jacob Boudoukh
, Ronen Feldman
, Shimon Kogan
, and Matthew Richardson
classify news articles by topic (such as analyst recommendations, financial information, acquisitions and mergers, and so on) and tone, then compare the market reaction on days with "no-news" versus days with what they term "unidentified news" and "identified news." They show that stock-level volatility is similar on no-news days and unidentified news days, consistent with the idea that the intensity and importance of information arrival is the same across those days. However, on "identified news days" the volatility of stock prices is more than double what it is on other days. They estimate that identified news days are approximately 30 percent more likely to be associated with extreme returns (defined by the bottom and top 10 percent of the return distribution) and that unidentified and no-news days are slightly more likely to be associated with moderate returns (in the middle 30-70 percent range of the returns distribution).
11 March 2013
and Nathan Nunn
find that a tradition of local-level democracy – that is, having the local leader chosen through consensus rather than other methods, such as hereditary appointment – is associated with more democratic national institutions today. They surmise that a tradition of village-level democracy may affect people’s attitudes about the appropriateness of democratic institutions, and in turn affect the stability of such institutions at the national level. Finally, they show that countries with a past experience of local democracy have a stronger rule of law, less corruption, and higher per capita income today.