Template-Type: ReDIF-Paper 1.0 Title: State Government Revenue and Expenditures: A Bootstrap Panel Analysis Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: The current fiscal crises that most states in the United States are facing are generally the result of a severe macroeconomic downturn combined with a limited ability of the states to respond to such shocks. States are facing increased demand for public services at the same time revenue is falling. In this context, this paper explores the issue of temporal priority between government expenditures and revenue at the state and local levels. The results show that there is no uniform relationship between government revenue and spending across different states in the US. In fact, about 40% of the states show the absence of any temporal relationship between these two variables. This is quite revealing given the current state of the debate in the academic and policy-making circle. A support for the tax-spend hypothesis is found in 18% of the states while the spend-tax hypothesis is prevalent in another 16%. In 26% of the states, the revenue and expenditures decisions are jointly determined by the government. Creation-Date: 2011-04 File-URL: http://epublications.marquette.edu/econ_workingpapers/14 File-Format: application/pdf Number: 2011-03 Classification-JEL: H71, H72 Keywords: state government, revenue, expenditures Handle: RePEc:mrq:wpaper:2011-03 Template-Type: ReDIF-Paper 1.0 Title: Inflation and Inflation-Uncertainty in India: The Policy Implications of the Relationship Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: Inflation and its related uncertainty can impose costs on real economic output in any economy. This paper analyzes the relationship between inflation and inflation uncertainty in India. Initial estimates show the inflation rate to be a stationary process. The maximum likelihood estimates from the GARCH model reveal strong support for the presence of a positive relationship between the level of inflation and its uncertainty. The Granger causality results indicate a feedback between inflation and uncertainty. With Granger causality running both ways, the Friedman-Ball and Cukierman-Meltzer hypotheses hold simultaneously in India. It provides strong support to the notion of an opportunistic central bank in India. Creation-Date: 2011-08 File-URL: http://epublications.marquette.edu/econ_workingpapers/15 File-Format: application/pdf Number: 2011-04 Classification-JEL: E31, E58, O53 Keywords: inflation, uncertainty, India Handle: RePEc:mrq:wpaper:2011-04 Template-Type: ReDIF-Paper 1.0 Title: 'Til Recession Do Us Part: Booms, Busts, and Divorce in the United States Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: A general hypothesis regarding the impact of permanent income levels and business cycle fluctuations on divorce rate at the state level in the United States is analyzed in the paper. Using data for 45 states over the 1978-2009 sample period, the paper shows that the higher the level of transitory income, the higher is the incidence of divorce. In other words, divorce is pro-cyclical. Why do divorce decrease during recession and increase during expansion? When an economy is in crisis and people’s incomes are low, the cost of divorce will prevent a couple from divorcing irrespective of the quality of their marriage. In this case, divorce is not an effective option. Extending this reasoning to the Great Recession of 2007-9, it can be argued that scarce employment opportunities and reductions in the value of martial assets had forced couples to remain together, notwithstanding marital difficulties. As the economy moved into a slow and moderate recovery beginning in mid-2009, this pent-up demand for divorce was released and the rates increased. That, in large part, is why divorce generally follow a ‘pro-cyclical’ course, fluctuating in sympathy with the economy. Creation-Date: 2011-08 File-URL: http://epublications.marquette.edu/econ_workingpapers/16 File-Format: application/pdf Number: 2011-05 Classification-JEL: E32, J12 Keywords: divorce, business cycle, Great Recession Handle: RePEc:mrq:wpaper:2011-05 Template-Type: ReDIF-Paper 1.0 Title: Do Stock Market Risk Premiums Respond to Consumer Confidence? Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: During the 2007-9 Great Recession, the risk premium associated with U.S. stocks sharply increased and has since remained significantly higher compared to its range during the last 40 years. The increase in the equity risk premium has led many analysts to believe that risk aversion among stock investors has moved to a permanently higher range in recent years. Our empirical findings show that the recent increase in the equity risk premium primarily reflects a temporary collapse in consumer confidence. As long as the consumer confidence in the sustainability of economic recovery remains low, today's elevated risk premium would persist. Once the confidence level starts to recover - as it has done after every recession since the 1960s - the required return among stock market investors should also diminish. Creation-Date: 2011-08 File-URL: http://epublications.marquette.edu/econ_workingpapers/17 File-Format: application/pdf Number: 2011-06 Classification-JEL: C22, G11, G14 Keywords: Risk Premium, Consumer Confidence, Equity Market, Risk Aversion, Great Recession Handle: RePEc:mrq:wpaper:2011-06 Template-Type: ReDIF-Paper 1.0 Title: Factoring Emerging Markets into the Relationship Between Global Liquidity and Commodities Author-Name: Chowdhury, Abdur Author-X-Name-First: Steven Author-X-Name-Last: Landgraf Author-Workplace-Name: Department of Economics Marquette University Author-Email: steven.landgraf@Marquette.edu Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: What caused the mid-2000s world commodity price “bubble” and the recent commodity price growth during the economic recovery after the 2007-2009 recession? The classical “supply and demand” interpretation offered by some observers suggests that rapid global industrial growth over the past decade – the so-called “demand channel” – is the key driver of price growth. Others have argued that recent bouts of commodity price growth were directly related to central banks, especially the U.S. Federal Reserve, injecting too much money or “liquidity” into the financial system. They assert that high commodity prices are a result of excessively loose monetary policy. This paper extends the current research in this area by incorporating emerging economies, the BRIC (Brazil, Russia, India, and China) nations specifically, into global measures. It is hypothesized that factoring BRIC nations into the analysis provides useful information for examining the relationship between commodity prices and global liquidity that is not captured by advanced country data alone. The statistical model in this paper accounts for the two-way relationships that can exist between output, price, and monetary variables in a globally interconnected system. Various tests of the model consistently suggest that the “demand channel” plays a large part in explaining commodity price growth whether BRIC countries are included or excluded from the analysis. However, excess liquidity may also play a part in explaining price growth. In addition, factoring in BRIC country data leads to the conclusion that unexpected movements in liquidity eventually explain more of the variation in commodity prices than unexpected demand shocks. This specific result is not caught in the sample that only incorporates advanced economies. Therefore, policymakers and researchers should not ignore emerging markets when examining commodity prices and monetary factors in a global context. Studies that exclude these countries lose key information on the effects of global monetary fluctuations. Creation-Date: 2011-08 File-URL: http://epublications.marquette.edu/econ_workingpapers/18 File-Format: application/pdf Number: 2011-07 Classification-JEL: E30, E52, Q01 Keywords: Commodity price, global monetary policy, BRIC Handle: RePEc:mrq:wpaper:2011-07 Template-Type: ReDIF-Paper 1.0 Title: Identity Author-Name: Davis, John Author-X-Name-First: John Author-X-Name-Last: Davis Author-Workplace-Name: Department of Economics Marquette University Author-Email: john.davis@Marquette.edu Abstract: This chapter introduces the economics and identity literature, and discusses the relationship between social identity and personal identity. It distinguishes categorical and relational types of social identities, and argues that the former are more readily associated with instrumentally rational behavior, while the latter, which involve close contact with others in roles and social positions, are more readily associated with behavior in which individuals unilaterally reciprocate the actions of others – what Bruni terms unilateral altruism, which involves a non-instrumental or deontological type of motivation. The chapter also distinguishes two views of personal identity as relational in nature, Bachrach's game-theoretic approach and one based on collective intentionality theory, and concludes by arguing that the Homo economicus view of personal identity is circular. Creation-Date: 2011-10 File-URL: http://epublications.marquette.edu/econ_workingpapers/19 File-Format: application/pdf Number: 2011-08 Classification-JEL: Keywords: social identity, personal identity, unilateral altruism, deontological motivation Handle: RePEc:mrq:wpaper:2011-08 Template-Type: ReDIF-Paper 1.0 Title: The Development Effects of Natural Resources: A Geographical Dimension Author-Name: Carmignani, Fabrizio Author-X-Name-First: Fabrizio Author-X-Name-Last: Carmignani Author-Workplace-Name: University of Queensland Author-Email: Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@marquette.edu Abstract: Despite the recent growth resurgence, Sub-Saharan Africa (SSA) remains the poorest region in the world. At the same time, it is a region that heavily relies on natural resources. In this paper we investigate the extent to which the second fact helps explain the first one. The distinctive feature of our study is that we take a geographical perspective and allow the effect of natural resources to differ across regions of the world. Our findings suggest that (i) the effect of natural resource intensity on per-capita income is positive and significant in general, but almost negligible and possibly negative in SSA, (ii) natural resources have a negative effect on institutional quality in SSA only, (iii) natural resources hinder human capital accumulation in SSA much more than anywhere else, and (iv) the combination of bad disease environments and large resource endowments accounts for most of the observed cross-regional differences in the effect of natural resources. Creation-Date: 2011-11 File-URL: http://epublications.marquette.edu/econ_workingpapers/20 File-Format: application/pdf Number: 2011-09 Classification-JEL: O11, O55, Q28 Keywords: Sub-Saharan Africa, natural resources, disease, institutions, human capital Handle: RePEc:mrq:wpaper:2011-09 Template-Type: ReDIF-Paper 1.0 Title: Obituary: Warren J. Samuels (1933-2011) Author-Name: Davis, John Author-X-Name-First: John Author-X-Name-Last: Davis Author-Workplace-Name: Department of Economics Marquette University Author-Email: john.davis@Marquette.edu Abstract: This paper examines the research and career of the late Warren J. Samuels (1933-2011), an influential institutionalist economist in the Wisconsin John Commons tradition and well-known historian and methodologist of economics. It discusses four main positions Samuels developed and held regarding the history of economic thought as intellectual history, the theory of economic policy, methodological pluralism, and the invisible hand doctrine. Among the views considered are: his matrix approach to meaningfulness, his characterization of intellectual systems, his emphasis on the centrality of the social order, his theory of economic policy as a neglected subject, his discourse analysis of language, his emphasis on the hermeneutic circle and critique of foundationalism, and argument that the invisible hand lacks ontological and epistemological credentials and functions as a means of social control and psychic balm. Much of the discussion is cast in terms of Samuels’ own reflections on what he believed is involved in being an historian of economics. Creation-Date: 2011-12 File-URL: http://epublications.marquette.edu/econ_workingpapers/21 File-Format: application/pdf Number: 2011-10 Classification-JEL: B25, B31, B41 Keywords: Samuels, institutionalism, matrix approach, invisible hand Handle: RePEc:mrq:wpaper:2011-10 Template-Type: ReDIF-Paper 1.0 Title: Samuels on Methodological Pluralism in Economics Author-Name: Davis, John Author-X-Name-First: John Author-X-Name-Last: Davis Author-Workplace-Name: Department of Economics Marquette University Author-Email: john.davis@Marquette.edu Abstract: Warren Samuels was an influential proponent of methodological pluralism in economics. This short paper discusses his understanding of methodological pluralism, and argues that it is based on three distinct components: (1) his critique of the idea that theories have epistemic foundations and his ‘matrix approach to meaningfulness,’ (2) his belief that the absence of meta-principles for science combined with our human psychology create an existential dilemma for theorists and policy-makers, and (3) his understanding of relativism, social constructivism, and ‘limited but affirmative’ defense of nihilism against the charge of skepticism. The paper closes with a brief discussion of what Samuels’ methodological pluralism might tell us about historiography and the history of economics. Creation-Date: 2012-03 File-URL: http://epublications.marquette.edu/econ_workingpapers/22 File-Format: application/pdf Number: 2012-01 Classification-JEL: B23, B31, B41 Keywords: Samuels, methodological pluralism, economic methodology, economics profession Handle: RePEc:mrq:wpaper:2012-01 Template-Type: ReDIF-Paper 1.0 Title: Economics Imperialism under the Impact of Psychology: The Case of Behavioral Development Economics Author-Name: Davis, John Author-X-Name-First: John Author-X-Name-Last: Davis Author-Workplace-Name: Department of Economics Marquette University Author-Email: john.davis@Marquette.edu Abstract: Economics imperialism is broadly explained as economics having an impact on other disciplines. But how should economics imperialism be understood when it is in some sense the product of other disciplines having an impact on economics? The paper examines psychology’s impact on economics in connection with the emergence of behavioral development economics, and then discusses the nature of behavioral development economics imperialism associated with development economists’ explanations of non-market dimensions of life in developing economies in behavioral economics terms. The paper argues that this new form of economics imperialism reflects economics’ selective appropriation from psychology of the Kahneman-Tversky heuristics and biases view of choice behavior and rejection of the Gigerenzer-ABC group fast and frugal heuristics view. This selective appropriation, however, causes behavioral development economics imperialism to also function as a social and cultural imperialism since its utility theory-based policy recommendations impose liberal society economic values on developing economy societies. Thus recent economics-plus-psychology imperialism might be said to function as social science imperialism under the leadership of economics. Creation-Date: 2013-02 File-URL: http://epublications.marquette.edu/econ_workingpapers/23 File-Format: application/pdf Number: 2013-01 Classification-JEL: B23, B31, B41 Keywords: economics imperialism, choice heuristics, behavioral development economics Handle: RePEc:mrq:wpaper:2013-01 Template-Type: ReDIF-Paper 1.0 Title: Economists’ Odd Stand on the Positive-Normative Distinction: A Behavioral Economics View Author-Name: Davis, John Author-X-Name-First: John Author-X-Name-Last: Davis Author-Workplace-Name: Department of Economics Marquette University Author-Email: john.davis@Marquette.edu Abstract: This chapter examines economists’ indefensible attachment to the positive-normative distinction, and suggests a behavioral economics explanation of their behavior on the subject. It reviews the origins of the distinction in Hume’s guillotine and logical positivism, and shows how they form the basis for Robbins’ understanding of value neutrality. It connects philosophers’ rejection of logical positivism to their rejection of the positive-normative distinction, explains and modifies Putnam’s view of fact-value entanglement, and identifies four main ethical value judgments that contemporary economists employ. The behavioral explanation of economists’ denial of these value judgments emphasizes loss aversion and economists’ social identity as economists. Creation-Date: 2013-03 File-URL: http://epublications.marquette.edu/econ_workingpapers/24 File-Format: application/pdf Number: 2013-02 Classification-JEL: Keywords: value neutrality, Robbins, Putnam, fact-value entanglement, loss aversion Handle: RePEc:mrq:wpaper:2013-02 Template-Type: ReDIF-Paper 1.0 Title: War and the Fiscal Capacity of the State Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Author-Name: Murshed, Syed Mansoob Author-X-Name-First: Syed Author-X-Name-Last: Murshed Author-Workplace-Name: International Institute of Social Studies, The Hague Abstract: We examine the role of war in retarding state fiscal capacity in developing countries, measured by tax revenue ratios to GDP. This in contrast to the European experience from the Renaissance to the 20th century, where it is believed that war and state-building were inseparable, enhancing the fiscal capacity of the state; in turn enlarging the scope and magnitude of government expenditure. We build a simple theoretical model of a factionalized state, where patronage substitutes for common interest public goods, along with the possibility of violent contestation over a rent or prize, typically in the form of natural resource revenues. Our dynamic panel empirical analysis on the determinants of fiscal capacity is applied to 79 developing countries, during 1980-2010. Results indicate that war, especially in its current dominant form of civil war, retards fiscal capacity, along with imperfect democracy, political repression, the quality of governance, dependence on oil and macroeconomic mismanagement. High intensity conflict is particularly destructive of state capacity. Countries experiencing low intensity wars, other institutional factors may matter more for fiscal capacity formation compared to war. The diminution of state capacity due to war appears less pronounced after the end of the cold war. Creation-Date: 2013-04 File-URL: http://epublications.marquette.edu/econ_workingpapers/25 File-Format: application/pdf Number: 2013-03 Classification-JEL: F51, H2, O11 Keywords: Handle: RePEc:mrq:wpaper:2013-03 Template-Type: ReDIF-Paper 1.0 Title: Securitization of Credit Card Debt and its Determinants Author-Name: Nourzad, Farrokh Author-X-Name-First: Farrokh Author-X-Name-Last: Nourzad Author-Workplace-Name: Department of Economics Marquette University Author-Email: farrokh.fourzad@Marquette.edu Author-Name: Szczesniak, Katherine Author-X-Name-First: Katherine Author-X-Name-Last: Szczesniak Author-Workplace-Name: Kohl's Author-Name: Hunter, William Author-X-Name-First: William Author-X-Name-Last: Hunter Author-Workplace-Name: Department of Finance Marquette University Author-Email: william.hunter@Marquette.edu Creation-Date: 2013-04 File-URL: http://epublications.marquette.edu/econ_workingpapers/26 File-Format: application/pdf Number: 2013-04 Classification-JEL: E3, E4, G1 Keywords: Handle: RePEc:mrq:wpaper:2013-04 Title: Future Implications of Debt and Deleveraging in the United States Economy Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Author-Name: Brown, Patrick Author-X-Name-First: Patrick Author-X-Name-Last: Brown Author-Workplace-Name: Citigroup Global Markets, Inc. Abstract: This paper will take a broad based approach in analyzing the structure of the U.S. economy with a particular emphasis on the disruptive U.S. recession and financial crisis which began circa 2008. The role of the U.S. government and the implications high levels of fiscal debt have on the projected growth path of the U.S. economy will be the primary focus of the paper. The discussion will show that the U.S. has likely entered a new, much more difficult stage in its history of economic growth. The short to medium term growth potential of the U.S. economy has fallen below the trend level established since WWII. The flexibility of the U.S. economy will help foster the necessary adjustments; however, this new era will force difficult fiscal and monetary policy choices that have different implications for different section of the population. The policy makers must recognize the changing dynamics of the U.S. economy and they must be prudent in drafting policy that establishes a stronger foundation for future growth. Younger generations in particular will need to take notice of the decisions being made and plan accordingly as it relates to their spending, saving and investment habits. Creation-Date: 2013-05 File-URL: http://epublications.marquette.edu/econ_workingpapers/27 File-Format: application/pdf Number: 2013-05 Classification-JEL: Keywords: Debt, Deleveraging, Deficit, Great Recession, Demographics Handle: RePEc:mrq:wpaper:2013-05 Title: The Impact of Output and Exchange Rate Volatility on Fixed Private Investment: Evidence from Selected G7 Countries Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Author-Name: Wheeler, Mark Author-X-Name-First: Mark Author-X-Name-Last: Wheeler Author-Workplace-Name: Western Michigan University Abstract: This paper will take a broad based approach in analyzing the structure of the U.S. economy with a particular emphasis on the disruptive U.S. recession anThis study examines the impact of shocks to exchange rate and output uncertainty (volatility) on real private fixed investment (FI) in Canada, Germany, the United Kingdom, and the United States. The analysis is conducted using vector autoregressive models that contain the price level, real output, the volatility of real output, the real exchange rate, the volatility of the real exchange rate, an interest rate, and FI. The results yield important public policy implications with regard to the impact of output volatility of FI. Our analysis indicates that volatility shocks, measured as output volatility or exchange rate volatility, do not have a significant impact on FI for any country in our study.d financial crisis which began circa 2008. The role of the U.S. government and the implications high levels of fiscal debt have on the projected growth path of the U.S. economy will be the primary focus of the paper. The discussion will show that the U.S. has likely entered a new, much more difficult stage in its history of economic growth. The short to medium term growth potential of the U.S. economy has fallen below the trend level established since WWII. The flexibility of the U.S. economy will help foster the necessary adjustments; however, this new era will force difficult fiscal and monetary policy choices that have different implications for different section of the population. The policy makers must recognize the changing dynamics of the U.S. economy and they must be prudent in drafting policy that establishes a stronger foundation for future growth. Younger generations in particular will need to take notice of the decisions being made and plan accordingly as it relates to their spending, saving and investment habits. Creation-Date: 2013-11 File-URL: http://epublications.marquette.edu/econ_workingpapers/28 File-Format: application/pdf Number: 2013-06 Classification-JEL: F41 Keywords: Fixed investment, exchange rate volatility, G7 countries, VAR model, Variance Decomposition Handle: RePEc:mrq:wpaper:2013-06 Title: Terms of Trade Shocks and Private Savings in the Developing Countries Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: This paper will take a broad based approach in analyzing the structure of the U.S. economy with a particular emphasis on the disruptive U.S. recession anThis study examines the impact of shocks to exchange rate and output uncertainty (volatility) on real private fixed investment (FI) in Canada, Germany, the United Kingdom, aEconomic agents in the developing countries are subject to tight credit constraints, which are more pronounced during bad state of nature. Thus, adverse shocks to commodity prices in the world market can force them to reduce savings by a larger amount than they would otherwise have. Empirical analysis using a dynamic GMM model and data from 45 developing countries confirm that most of the determinants of savings identified in the literature also apply to the developing countries. The transitory component in the terms of trade have a larger positive impact than the permanent component. This reflects the lack of access to foreign borrowing. Although the impact of terms of trade shocks is found to be asymmetric, the magnitude of the impact appears to be relatively small. The results are robust for alternative estimators, determinants and country groupings.nd the United States. The analysis is conducted using vector autoregressive models that contain the price level, real output, the volatility of real output, the real exchange rate, the volatility of the real exchange rate, an interest rate, and FI. The results yield important public policy implications with regard to the impact of output volatility of FI. Our analysis indicates that volatility shocks, measured as output volatility or exchange rate volatility, do not have a significant impact on FI for any country in our study.d financial crisis which began circa 2008. The role of the U.S. government and the implications high levels of fiscal debt have on the projected growth path of the U.S. economy will be the primary focus of the paper. The discussion will show that the U.S. has likely entered a new, much more difficult stage in its history of economic growth. The short to medium term growth potential of the U.S. economy has fallen below the trend level established since WWII. The flexibility of the U.S. economy will help foster the necessary adjustments; however, this new era will force difficult fiscal and monetary policy choices that have different implications for different section of the population. The policy makers must recognize the changing dynamics of the U.S. economy and they must be prudent in drafting policy that establishes a stronger foundation for future growth. Younger generations in particular will need to take notice of the decisions being made and plan accordingly as it relates to their spending, saving and investment habits. Creation-Date: 2013-11 File-URL: http://epublications.marquette.edu/econ_workingpapers/29 File-Format: application/pdf Number: 2013-07 Classification-JEL: F10, E21, O50 Keywords: private savings, terms of trade, GMM estimation, developing countries, shocks Handle: RePEc:mrq:wpaper:2013-07 Title: The Impact of Output and Exchange Rate Volatility on Fixed Private Investment: Evidence from Selected G7 Countries Author-Name: Drope, Jeffrey Author-X-Name-First: Jeffrey Author-X-Name-Last: Drope Author-Workplace-Name: Department of Finance Marquette University Author-Email: jeffrey.drope@Marquette.edu Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: This paper will take a broad based approach in analyzing the structure of the U.S. economy with a particular emphasis on the disruptive U.S. recession anThis study examines the impact of shocks to exchange rate and output uncertainty (volatility) on real private fixed investment (FI) in Canada, Germany, the United Kingdom, and the United States. The analysis is conducted using vector autoregressive models that contain the price level, real output, the volatility of real output, the real exchange rate, the volatility of the real exchange rate, an interest rate, and FI. The results yield important public policy implications with regard to the impact of output volatility of FI. Our analysis indicates that volatility shocks, measured Over time and across countries, researchers have noted frequent and mostly unexplained gender differences in the levels of support for policies of free or freer trade: women tend to be less favorable toward policies of liberalizing trade than men. Yet, no well substantiated theoretical or empirical account of the gender component of trade attitudes has emerged. Using an economic security explanation based principally on a mobile factors approach, we find that it is not women generally who are more negative toward trade but particularly economically vulnerable women – i.e. women from the scarce labor factor. We utilize recent survey data on individuals’ attitudes toward different facets of trade and its effects across three disparate regions to examine this phenomenon empirically. An economic security approach helps to explain the marked differences in attitudes toward trade among lower- and higher-skilled females in developing and developed countries.as output volatility or exchange rate volatility, do not have a significant impact on FI for any country in our study.d financial crisis which began circa 2008. The role of the U.S. government and the implications high levels of fiscal debt have on the projected growth path of the U.S. economy will be the primary focus of the paper. The discussion will show that the U.S. has likely entered a new, much more difficult stage in its history of economic growth. The short to medium term growth potential of the U.S. economy has fallen below the trend level established since WWII. The flexibility of the U.S. economy will help foster the necessary adjustments; however, this new era will force difficult fiscal and monetary policy choices that have different implications for different section of the population. The policy makers must recognize the changing dynamics of the U.S. economy and they must be prudent in drafting policy that establishes a stronger foundation for future growth. Younger generations in particular will need to take notice of the decisions being made and plan accordingly as it relates to their spending, saving and investment habits. Creation-Date: 2013-11 File-URL: http://epublications.marquette.edu/econ_workingpapers/30 File-Format: application/pdf Number: 2013-08 Classification-JEL: F14, F20, O57 Keywords: trade policy, gender difference, labor mobility, economic security Handle: RePEc:mrq:wpaper:2013-08 Template-Type: ReDIF-Paper 1.0 Title: Virtual Currency and the Financial System: The Case of Bitcoin Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Author-Name: Mendelson, Barry K. Author-X-Name-First: Barry Author-X-Name-Last: Mendelson Author-Workplace-Name: Capital Market Investments, Inc. Abstract: Technological development and the increased use of the internet have led to the proliferation of virtual communities. Some of these communities have created and circulated their own currency for exchanging goods and services. Bitcoin is currently the most popular among these virtual or digital currencies and has been in news recently because of the wild fluctuations in its ‘value’ and also significant venture capital investment in entities associated with it.1 Bitcoin is relevant in several areas of the financial system and is therefore of interest to central banks, consumers and investors. Digital currencies are part of a broader group of virtual currencies that include credit card points, air miles, loyalty points and coupons (Chart 1). With the advent of the Internet, mobile devices and detailed consumer information, companies are increasingly using digital currencies as a marketing tool. As a result, there has been a sharp increase in the use of digital currencies, particularly for app-based coins and tokens, mobile coupons, and personal data exchanged for digital content. As these trends evolve, digital currencies have the potential to become more popular and compete with traditional currencies. This paper aims to provide some clarity in particular on Bitcoin, its role and potential future use in the financial system and the risks associated with this form of digital currency.. It will begin by providing a short introduction to the Bitcoin network as well as describe the benefits of allowing the Bitcoin network to develop and innovate. It will highlight concerns for consumers, policymakers and financial regulators. Next it will analyze the role that Bitcoin could play in the financial system. The paper will conclude by providing recommendations to address policymakers’ concerns while allowing for further innovation within the Bitcoin network. An initial comprehensive overview of this kind is absent from the existing literature. This paper intends to fill that gap in the literature. Creation-Date: 2013-12 File-URL: http://epublications.marquette.edu/econ_workingpapers/31 File-Format: application/pdf Number: 2013-09 Classification-JEL: Keywords: Handle: RePEc:mrq:wpaper:2013-09 Title: Neuroeconomics and Identity Author-Name: Davis, John B. Author-X-Name-First: John Author-X-Name-Last: Davis Author-Workplace-Name: Department of Economics Marquette University Author-Email: john.davis@Marquette.edu Abstract: This short paper discusses majority and minority views in economics regarding the value of neuroscience for economics – and thus the value of the neuroeconomics research program. It argues that neuroeconomics’ reception ultimately depends on whether economists adopt a philosophy of science thinking closer to what exists in other sciences. It then argues that an inadvertent product of this debate is whether people can be identified as relatively independent agents. The paper concludes with comments on what this debate implies about the conception of the decision-maker as a relatively independent identity. Creation-Date: 2013-10 File-URL: http://epublications.marquette.edu/econ_workingpapers/32 File-Format: application/pdf Number: 2013-10 Classification-JEL:A12, B41, D03, D87 Keywords: neuroeconomics, philosophy of science, instrumentalism, formalism, decision-maker autonomy, identity Handle: RePEc:mrq:wpaper:2013-10 Title: Is Bitcoin the 'Paris Hilton' of the Currency World? Or Are the Early Investors onto Something That Will Make Them Rich? Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Abstract: The Bitcoin phenomenon, and the technological innovation that made it possible, is interesting - but for investors large and small, the more pertinent question is whether they should buy the virtual currency or avoid it. We analyze a Bitcoin investment from the standpoint of a U.S. investor with a diversified portfolio. Bitcoin investment shows high average return as well as volatility. Mean-variance Spanning tests show that Bitcoin investment offers significant diversification benefits. Well diversified portfolios with a small Bitcoin component (2%) shows small improvement in the risk-return trade-off. Creation-Date: 2014-01 File-URL: http://epublications.marquette.edu/econ_workingpapers/33 File-Format: application/pdf Number: 2014-01 Classification-JEL:G11, O16, E44 Keywords: Bitcoin, risk, return, virtual currency Handle: RePEc:mrq:wpaper:2014-01 Title: Trade Volatility and the GATT/WTO: Does Membership Make a Difference? Author-Name: Chowdhury, Abdur Author-X-Name-First: Abdur Author-X-Name-Last: Chowdhury Author-Workplace-Name: Department of Economics Marquette University Author-Email: abdur.chowdhury@Marquette.edu Author-Name: Xuepeng, Liu Author-X-Name-First: Xuepeng Author-X-Name-Last: Liu Author-Workplace-Name: Kennesaw State University Author-Name: Wang, Miao Author-X-Name-First: Miao Author-X-Name-Last: Wang Author-Workplace-Name: Department of Economics Marquette University Author-Email: grace.wang@Marquette.edu Author-Name: Wong, M. C. Sunny Author-X-Name-First: M. C. Author-X-Name-Last: Wong Author-Workplace-Name: University of San Francisco Abstract: The Bitcoin phenomenon, and the technological innovation that made it possible, is interesting - but for investors large and small, the more pertinent question is whether they should buy the virtual currency or avoid it. We analyze a Bitcoin investment from the standpoint of a U.S. investor with a diversified portfolio. Bitcoin investment shows high average return as well as volatility. Mean-variance Spanning tests show that Bitcoin investment offers significant diversification benefits. Well diversified portfolios with a small Bitcoin component (2%) shows small improvement in the risk-return trade-off. Creation-Date: 2014-01 File-URL: http://epublications.marquette.edu/econ_workingpapers/34 File-Format: application/pdf Number: 2014-02 Classification-JEL:F02, F13, F14 Keywords: trade volatility, WTO, gravity model Handle: RePEc:mrq:wpaper:2014-02 Title: Trade Bounded Rationality and Bounded Individuality Author-Name: Davis, John Author-X-Name-First: John Author-X-Name-Last: Davis Author-Workplace-Name: Department of Economics Marquette University Author-Email: john.davis@marquette.edu Abstract: This paper argues that since the utility function conception of the individual is derived from standard rationality theory, the view that rationality is bounded suggests that individuality should also be seen as bounded. The meaning of this idea is developed in terms of two ways in which individuality can be said to be bounded, with one bound associated with Kahneman and Tversky’s prospect theory and the ‘new’ behavioral economics and a second bound associated with Simon’s evolutionary thinking and the ‘old’ behavioral economics. The paper then shows how different bounded individuality conceptions operate in nudge economics, agent-based modeling, and social identity theory, explaining these conceptions in terms of how they relate to these two behavioral economics views of bounded rationality. How both the ‘new’ and ‘old’ individuality bounds might then be combined in a single account is briefly explored in connection with Kirman’s Marseille fish market analysis. Creation-Date: 2014-07 File-URL: http://epublications.marquette.edu/econ_workingpapers/35 File-Format: application/pdf Number: 2014-03 Keywords: bounded rationality, bounded individuality, nudge economics, agent-based modeling, social identity theory, Marseille fish market Handle: RePEc:mrq:wpaper:2014-03