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Permanent Effects (permanent + effects)

Distribution by Scientific Domains
Business, Economics, Finance and Accounting77%
Distribution within Business, Economics, Finance and Accounting
General & Introductory Economics42%

Selected Abstracts

Share Repurchase Offers and Liquidity: An Examination of Temporary and Permanent Effects

FINANCIAL MANAGEMENT, Issue 2 2008
Nandkumar Nayar
Open-market repurchase programs do not allow for precise estimates of share buy-back intensity to measure liquidity effects. To circumvent the uncertainty surrounding the quantity and timing of shares truly acquired in repurchase programs and to measure their long-term impact, we examine Dutch auctions and fixed-price tender offers. We investigate both the temporary and permanent liquidity effects of share repurchase programs and find that the improvement in liquidity is transitory and limited to the tender period when the firm's offer to repurchase shares is outstanding. Improvements in liquidity over longer intervals appear to be the result of an overall price improvement and a reduction in volatility rather than the result of structural change in market dynamics. [source]

Incorporating Maintenance Effectiveness in the Estimation of Dynamic Infrastructure Performance Models

COMPUTER-AIDED CIVIL AND INFRASTRUCTURE ENGINEERING, Issue 3 2008
Chih-Yuan Chu
Specifically, we consider state-space specifications of autoregressive moving averages with exogenous inputs models to develop deterioration and inspection models for infrastructure facilities, and intervention analysis to estimate transitory and permanent effects of maintenance, for example, performance jumps or deterioration rate changes. To illustrate the methodology, we analyze the effectiveness of an overlay on a flexible pavement section from the AASHO Road Test. The results show the effect of the overlay on improvements both on surface distress, that is, rutting and slope variance, as well as on the pavement's underlying serviceability. The results also provide evidence that the overlay changes the pavement's response to traffic, that is, the overlay causes a reduction in the rate at which traffic damages the pavement. [source]

Monetary Policy, Credit and Aggregate Supply: The Evidence from Italy

ECONOMIC NOTES, Issue 3 2002
Riccardo Fiorentini
This paper concerns theory and evidence of the monetary transmission mechanisms. Current research has deeply investigated factors, such as dependence of firms on bank credit, that amplify the impact of monetary policy impulses on aggregate demand exerting strong but temporary effects on output and employment. We present an intertemporal macroeconomic equilibrium model of a competitive economy where current production is financed by bank credit, and then we use it to identify supply,side effects of the credit transmission mechanism in data drawn from the Italian economy. We find evidence that the ,credit variables' identified by the model , the overnight rate as a proxy of monetary policy and a measure of credit risk , have permanent effects on employment and output by altering credit supply conditions to firms. To save on space, mathematical proofs, statistical tests and data sources have been gathered in two separate appendices that can be examined on request. (J.E.L.: E2, E5). [source]

Through-the-Cycle Ratings Versus Point-in-Time Ratings and Implications of the Mapping Between Both Rating Types

FINANCIAL MARKETS, INSTITUTIONS & INSTRUMENTS, Issue 1 2010
Rebekka Topp
The two philosophies of ratings, one that includes cyclical effects and the other that doesn't, are mirrored by the two different rating types commonly known as point-in-time (pit) and through-the-cycle (ttc). Point-in-time ratings try to evaluate the current situation of a customer by taking into account both cyclical and permanent effects. In contrast, through the-cycle ratings focus mainly on the permanent component of default risk and are nearly independent from cyclical changes in the creditworthiness of a customer. In this paper we give a review of the characteristics of both rating types and examine whether these properties can actually be observed in practice. In this context we present the results of an analysis of Standard& Poor's rating data, which show that the ratings, though being through-the-cycle, still vary in accordance with the business cycle. Another concern of this paper is the wide spread practice to map ,external' through-the-cycle ratings to ,internal' point-in-time ratings, with the purpose to enrich or validate a financial institution's internal rating database. We show that in doing so financial institutions severely misspecify customers' risk profiles and under- or overestimate costs in connection with credit pricing or capitalization. We confirm our theoretical considerations by calculating pricing quantities when using one or the other rating information. [source]

Market Reaction to Changes in the S&P SmallCap 600 Index

FINANCIAL REVIEW, Issue 3 2006
S. Gowri Shankar
G12; G14 Abstract Firms added to (deleted from) the S&P 600 index experience a significant price increase (decrease) at announcement. Firms that newly enter (exit) the S&P universe experience a larger price increase (decrease) than firms that move between S&P indexes. Trading volumes are higher after the announcement and institutional ownership increases (decreases) following index additions (deletions). However, the price and volume effects are temporary and are fully reversed within 60 days, in contrast to the permanent effects reported for S&P 500 changes. Our results support the temporary price-pressure hypothesis and are similar to results reported for Russell 2000 index changes. [source]

Leaning into the Wind: A Structural VAR Investigation of UK Monetary Policy,

OXFORD BULLETIN OF ECONOMICS & STATISTICS, Issue 5 2005
Andrew Mountford
Abstract This paper adapts Uhlig's [Journal of Monetary Economics (2005) forthcoming] sign restriction identification methodology to investigate the effects of UK monetary policy using a structural vector autoregression (VAR). It shows that shocks which can reasonably be described as monetary policy shocks have played only a small role in the total variation of UK monetary and macroeconomic variables. Most of the variation in UK monetary variables has been due to their systematic reaction to other macroeconomic shocks, namely non-monetary aggregate demand, aggregate supply, and oil price shocks. We also find, without imposing any long run identifying restrictions, that aggregate supply shocks have permanent effects on output. [source]

Are cortisol profiles a stable trait during child development?

AMERICAN JOURNAL OF HUMAN BIOLOGY, Issue 6 2009
Mark V. Flinn
Exposure to stressful experiences can increase vulnerability to adverse health outcomes. A potential neuroendocrine mechanism mediating the link between stress and health is the hypothalamic-pituitary-adrenal (HPA) system, with a key role attributed to the glucocorticoid hormone cortisol. Retrospective and cross sectional clinical studies of humans and experimental studies with nonhuman primates and rodents suggest that traumatic experiences during critical periods in development may have permanent effects on HPA regulation, which in turn can have deleterious effects on health. Here I report results from a continuous 20-year study (1988,2009) of children in a rural community on Dominica. Sequential data on cortisol levels, social stressors, and health in naturalistic, everyday conditions are examined to assess developmental trajectories of HPA functioning. Saliva aliquots were assayed for cortisol in concert with monitoring of growth, morbidity, and social environment. Analyses here include data from 1989 to 1999 for 147 children aged 3,16 years with >100 saliva samples each. Cortisol values were standardized by elapsed time since wake-up. Results do not support the hypothesis that traumatic stress during childhood causes permanent general elevation of cortisol levels. Am. J. Hum. Biol., 2009. © 2009 Wiley-Liss, Inc. [source]

HYSTERESIS IN UNEMPLOYMENT REVISITED: EVIDENCE FROM PANEL LM UNIT ROOT TESTS WITH HETEROGENEOUS STRUCTURAL BREAKS

BULLETIN OF ECONOMIC RESEARCH, Issue 4 2009
Jun-De Lee
C22; C23; J64 ABSTRACT This paper applies the panel LM unit root tests with heterogeneous structural breaks in level by Im,et al. (Oxford Bulletin of Economics and Statistics, 67 (2005), pp. 393,419) to re-examine the validity of hysteresis in the unemployment rates of 19 OECD countries. Our empirical findings are favourable to the stationarity of the unemployment rates, i.e., the unemployment hysteresis hypothesis is strongly rejected. Our results suggest that shocks to unemployment rates are temporary and soon converge when we control for breaks. A major policy implication of the study is that a fiscal or monetary stabilization policy would not have permanent effects on the unemployment rates of the 19 OECD countries. [source]

Testing the endogenous growth model: public expenditure, taxation, and growth over the long run

CANADIAN JOURNAL OF ECONOMICS, Issue 1 2001
Michael Bleaney
Endogenous growth models, such as Barro (1990), predict that government expenditure and taxation will have both temporary and permanent effects on growth. We test this prediction using panels of annual and period-averaged data for OECD countries during 1970,95, isolating long-run from short-run fiscal effects. Our results strongly support the endogenous growth model and suggest that long-run fiscal effects are not fully captured by period averaging and static panel methods. Unlike previous investigations, our estimates are free from biases associated with incomplete specification of the government budget constraint and do not appear to result from endogeneity of fiscal or investment variables. JEL Classification: H30, O40 Validation du modèle de croissance endogène: dépenses publiques, fiscalité et croissance à long terme. Des modèles de croissance endogène comme celui de Barro (1990) prédisent que dépenses gouvernementales et fiscalité vont avoir des effets temporaires et permanents sur la croissance. On met cette prévision au test à l'aide de données annuelles et pour certaines moyennes couvrant des sous-périodes pour les pays de l'OCDE (1970,95) dans le but de départager les effets à court et à long terme. Les résultats valident fortement le modèle de croissance endogène et suggèrent que les effets fiscaux à long terme ne sont pas pleinement capturés par des méthodes utilisant des moyennes ou des méthodes statiques. Contrairement aux résultats d'enquêtes antérieures, les résultats proposés ne souffrent pas de distorsions attribuables à une spécification incomplète de la contrainte budgétaire du gouvernement, et ne semblent pas être l'effet d'écho de l'endogénéité des variables fiscales et de l'investissement. [source]