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The Made in China 2025 (MIC 2025) strategy was introduced in 2015 and aims to reduce Chinese reliance on foreign technologies by adopting the import-substitution policy. The United States (US) considers China's super-ambitious industrial policy as a serious threat and is concerned about its high-tech industries, especially as Chinese technological firms are receiving generous government subsidies and tax cuts. The US, thus, entered a direct trade war with China to protect its domestic industries from unfair and inequitable competition. The US-China trade war has seriously shifted and interrupted global supply chains, thus creating a situation of uncertainty and instability for businesses that import and export US and Chinese products. The article is policy-based, and we reviewed the existing literature in depth. We addressed the industrialization pursuits of China under the MIC 2025. Furthermore, the article has analyzed the impact of the US-China trade war on global supply chains. Finally, the article has many implications; the article provides the possible policy routes for the governments of developing countries and regulators to address the reservations of developed countries regarding state-sponsored industries. [ABSTRACT FROM AUTHOR]

The objective of this study was to systematically review the literature related to the economic evaluation of kidney transplantation to determine the extent of current research and identify gaps for future research. We searched 4 medical and 2 economic electronic databases as well as hand-searching reference lists of review articles and other pertinent articles. Exclusion criteria included articles that did not include original work (ie, reviews), were not in English, and were not journal articles or economic working papers (eg, commentaries, theses, abstracts). Full-text data abstraction included qualitative and quantitative parameters with the intent to perform a gap analysis for future research. A total of 299 articles were included and spanned a 48-year period from 1968 to 2016, with >73% published in 2000 or after. The most common topics included immunosuppression drugs, dialysis vs kidney transplantation, organ allocation, and the potential market for donor organs. Most articles were from the United States and originated from 73 medical journals and 34 economic journals or working paper centers. There were 58 articles dealing with costing, 153 using cost-effectiveness, 69 using economic modeling, 6 performing systematic reviews with meta-analyses, and 13 exploring the qualitative financial environment of individuals and the economy. Research gaps were identified in every parameter used to evaluate the studies, and a new system of gap analysis for scoping reviews was also proposed. [ABSTRACT FROM AUTHOR]

Some studies have examined the tension between public health benefits and economic costs of interventions in the United States for the COVID-19 pandemic by merging epidemiological and economic models. We extract from these studies a data set consisting of lives saved and the associated costs for each intervention. Our analysis calculates cost–benefit ratios that allow the effectiveness of intervention types to be compared against each other and against the value of the statistical life and the value of the statistical life year. This work identifies patterns in the cost–benefit ratios that illuminate the strengths and weaknesses of different intervention strategies and thereby enhances the practical application of complex theoretical analyses. [ABSTRACT FROM AUTHOR]

Subnational input–output (IO) tables capture industry- and region-specific production, consumption, and trade of commodities and serve as a common basis for regional and multi-regional economic impact analysis. However, subnational IO tables are not made available by national statistical offices, especially in the United States (US), nor have they been estimated with transparent methods for reproducibility or updated regularly for public availability. In this article, we describe a robust StateIO modeling framework to develop state and two-region IO models for all 50 states in the US using national IO tables and state industry and trade data from reliable public sources such as the US Bureau of Economic Analysis. We develop 2012-2017 state IO models and two-region IO models at the BEA summary level. The two regions are state of interest and rest of the US. All models are validated by a series of rigorous checks to ensure the results are balanced at state and national levels. We then use these models to calculate a 2012–2017 time series of macro economic indicators and highlight results for 11 states that have distinct economies with respect to size, geography, and industry structure. We also compare selected indicators to state IO models created by popular licensed and open-source software. Our StateIO modeling framework is consolidated in an open-source R package, stateior, to ensure transparency and reproducibility. Our StateIO models are US-focused, which may not be transferrable to international accounts, and form the economic base of state versions of the US environmentally-extended IO models. [ABSTRACT FROM AUTHOR]

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This paper proposes an analytical framework for growth and development, and based on this methodological framework, this paper reveals why the United States has become powerful and predicts its probable decline. Different from the past views, this paper argues that the advantage integration–oriented production model and the proactive open strategy and policy orientation based on it are the core driving forces for growth and development. Driven by both capital and technology, the economic structure and social fabric of the United States has been undergoing tremendous changes for more than 200 years, so the members, the power, and the appeals of different interest groups are also changing. At the microlevel, the production model adapted to the economic structure and social fabric of the United States is changing, and correspondingly, at the macrolevel, the strategy and policy orientation of the United States are changing as well. This paper details the advantage integration–oriented development practices in U.S. history and briefly discusses the prospects of the practical application of this methodology. The United States is a typical country that achieved catch‐up through advantage integration and ultimately gained global economic dominance, and this implies that the strategy and policy based on this model of development are necessarily open and positive. However, the current growing conservative policy orientation in the United States may not be a good sign. [ABSTRACT FROM AUTHOR]

The increasing concern on the world waste issue has speed up the adoption of the circular economy model to replace the conventional “take, make, use, dispose” linear economy model. Life Cycle Assessment (LCA) has been widely used in the past to identify and evaluate the inputs and outputs of different activities carried out in a linear economy model. With more and more industry transition from linear economy model to Circular Economy (CE) model, especially in developed nations particularly Europe, United States and China, it is imperative for the LCA to consider the circularity relationship of resources in its framework to enhance the effectiveness of LCA. One of the fundamental principles of circular economy is that material waste is avoided by prioritizing the end-of-use capture of materials to create a positive value-driven closed loop. Nonetheless, the literature that include or integrate the circularity elements into the LCA framework remains limited. Anecdotal evidence has suggested that it is due to some limitations and barriers, including but not limited to industry acceptance level, high transition cost, lack of know-how expertise to enable the evaluation and others. In this work, the overview of the research and development towards the application of LCA to support CE strategies are reviewed. The limitations and challenges to apply LCA for a circular economy model are also identified to propose recommendations to extend the current application of LCA for a more robust strategy that capture the value of the reuse, recycle, remanufactured, repurposed resources and the potential upstream and downstream impacts for better decisions for sustainability. A case study in the palm oil industry is also presented to illustrate the possible development of CE-LCA framework in the context of developing countries. [ABSTRACT FROM AUTHOR]

Aims: The electrosurgical technology category is used widely, with a diverse spectrum of devices designed for different surgical needs. Historically, hospitals are supplied with electrosurgical devices from several manufacturers, and those devices are often evaluated separately; it may be more efficient to evaluate the category holistically. This study assessed the health economic impact of adopting an electrosurgical device-category from a single manufacturer. Methods: A budget impact model was developed from a U.S. hospital perspective. The uptake of electrosurgical devices from EES (Ethicon Electrosurgery), including ultrasonic, advanced bipolar, smoke evacuators, and reusable dispersive electrodes were compared with similar MED (Medical Energy Devices) from multiple manufacturers. It was assumed that an average hospital performed 10,000 annual procedures 80% of which involved electrosurgery. Current utilization assumed 100% MED use, including advanced energy, conventional smoke mitigation options (e.g. ventilation, masks), and single-use disposable dispersive electrode devices. Future utilization assumed 100% EES use, including advanced energy devices, smoke evacuators (i.e. 80% uptake), and reusable dispersive electrodes. Surgical specialties included colorectal, bariatric, gynecology, thoracic and general surgery. Systematic reviews, network meta-analyses, and meta-regressions informed operating room (OR) time, hospital stay, and transfusion model inputs. Costs were assigned to model parameters, and price parity was assumed for advanced energy devices. The costs of disposables for dispersive electrodes and smokeevacuators were included. Results: The base-case analysis, which assessed the adoption of EES instead of MED for an average U.S. hospital predicted an annual savings of $824,760 ($101 per procedure). Savings were attributable to associated reductions with EES in OR time, days of hospital stay, and volume of disposable electrodes. Sensitivity analyses were consistent with these base-case findings. Conclusions: Category-wide adoption of electrosurgical devices from a single manufacturer demonstrated economic advantages compared with disaggregated product uptake. Future research should focus on informing comparisons of innovative electrosurgical devices. [ABSTRACT FROM AUTHOR]

• Trochanteric hip fractures in the United States make up nearly half of total healthcare costs for all hip fracture types. • Unstable trochanteric fractures pose significant challenges and cement augmentation has been shown to improve stability. • An economic model for closed unstable trochanteric fractures showed fixation with cement augmentation reduced per-patient costs by $754.8. • Cost savings was the main driver for fixation with cement augmentation for closed unstable trochanteric fractures being the dominant strategy. • This may support surgeons in evidence-based clinical decision making and inform policy makers regarding coverage and reimbursement. Recent clinical studies have shown favorable outcomes for cement augmentation for fixation of trochanteric fracture. We assessed the cost-utility of cement augmentation for fixation of closed unstable trochanteric fractures from the US payer's perspective. The cost-utility model comprised a decision tree to simulate clinical events over 1 year after the index fixation surgery, and a Markov model to extrapolate clinical events over patients' lifetime, using a cohort of 1,000 patients with demographic and clinical characteristics similar to that of a published randomized controlled trial (age ≥75 years, 83 % female). Model outputs were discounted costs, quality-adjusted life years (QALYs), and incremental cost-effectiveness ratio (ICER) over a lifetime. Deterministic and probabilistic sensitivity analyses were performed to assess the impact of parameter uncertainty on results. Fixation with augmentation reduced per-patient costs by $754.8 and had similar per-patient QALYs, compared to fixation without augmentation, resulting in an ICER of −$130,765/QALY. The ICER was most sensitive to the utility of revision surgery, mortality risk ratio after the second revision surgery, mortality risk ratio after successful index surgery, and mortality rate in the decision tree model. The probability that fixation with augmentation was cost-effective compared with no augmentation was 63.4 %, 58.2 %, and 56.4 %, given a maximum acceptable ceiling ratio of $50,000, $100,000, and $150,000 per QALY gained, respectively. Fixation with cement augmentation was the dominant strategy, driven mainly by reduced costs. These results may support surgeons in evidence-based clinical decision making and may be informative for policy makers regarding coverage and reimbursement. [ABSTRACT FROM AUTHOR]

While evidence generated from health economic (HE) models is being used more commonly in health technology assessment (HTA) in the US, it is not consistently adopted by different stakeholder groups or across therapeutic areas. We hypothesize that actively engaging with multiple stakeholder groups throughout the model development process may result in models more widely considered by decision makers. To test this hypothesis, the Innovation and Value Initiative has launched a modeling effort to build an open-source HE model focusing on the disease state 'major depressive disorder'. A 20-member advisory group has been formed with representatives from patients, employers, clinicians, innovators, payers, and researchers to guide the model development process. While this effort is still in the early stages, the ongoing stakeholder engagement effort has yielded valuable insights that inform the model design. We have also identified several challenges to implementing this new approach. Our early findings suggest that the stakeholder engagement approach to HE model development has the potential to improve HTA in the US. [ABSTRACT FROM AUTHOR]

Objectives: This research aims to explore how often the National Institute for Health and Care Excellence (NICE) uses immature overall survival data to inform reimbursement decisions on cancer treatments, and the implications of this for resource allocation decisions.Methods: NICE cancer technology appraisals published between 2015 and 2017 were reviewed to determine the prevalence of using immature survival data. A case study was used to demonstrate the potential impact of basing decisions on immature data. The economic model submitted by the company was reconstructed and was populated first using survival data available at the time of the appraisal, and then using data from an updated data cut published after the appraisal concluded. The incremental cost-effectiveness ratios (ICERs) obtained using the different data cuts were compared. Probabilistic sensitivity analysis was undertaken and expected value of perfect information estimated.Results: Forty-one percent of NICE cancer technology appraisals used immature data to inform reimbursement decisions. In the case study, NICE gave a positive recommendation for a limited patient subgroup, with ICERs too high in the complete patient population. ICERs were dramatically lower when the final data cut was used, irrespective of the parametric model used to model survival. Probabilistic sensitivity analysis and expected value of perfect information may not have fully characterized uncertainty, because as they did not account for structural uncertainty.Conclusion: Analyses of cancer treatments using immature survival data may result in incorrect estimates of survival benefit and cost-effectiveness, potentially leading to inappropriate funding decisions. This research highlights the importance of revisiting past decisions when updated data cuts become available. [ABSTRACT FROM AUTHOR]

As in so many areas of law and politics in the United States, antitrust's center is at bay. On the right, it is besieged by those who would further limit its reach. On the left, it faces revisionists who propose significantly greater enforcement. One thing the two extremes share, however, is the denigration of the role of economics in antitrust analysis. Two of the Supreme Court's recent antitrust decisions at this writing reveal that economic analysis from the right no longer occupies the central role that it once had. On the left, some proposals display indifference to their economic impact on important participants in the economy. The antitrust laws speak of the conduct they prohibit in economic terms, such as "restraint of trade," "monopoly," and lessening of "competition." They do not embrace any particular economic ideology, such as the Chicago school or institutionalism. Nor do they require the use of any particular economic model, such as perfect competition or oligopoly. This openness gives policy makers a great deal of room, but it is not an invitation to economic nonsense. Further, economics should not be a tool for picking a winning interest group and then manipulating the doctrine to get that result. The Supreme Court's 2019 Apple decision slighted the economics of passedon consumer harm, a central component in analyzing private damages actions for more than forty years, and one that is critical to measuring competitive injury. In AmEx, the Court neglected the kind of transactional analysis that would have uncovered the true injuries in that case, defined the "relevant market" in such a way as to make that term economically incoherent, rejected a superior methodology for assessing power in favor of an inferior one, misunderstood completely the meaning and appropriate scope of free riding, and lost sight of the fact that marginal rather than total effects are central. Although the progressive wing of antitrust does a better job of identifying the problems that the competitive economy faces, some of its proposed solutions are calculated to make them worse. The pursuit of business concentration or bigness for its own sake will injure both consumers and labor far more than it benefits small business, who appear to be the intended beneficiaries. A proposal to forbid large platforms from selling their own products in competition with the products of others will harm both consumers and most small businesses, although it will benefit some large firms. When used correctly and without excessive ideology, economics is a powerful, neutral tool for helping people identify injuries to competition and appropriate fixes. Indeed, that is the first and best use of antitrust economics. Both extremes in this debate have ignored the first rule of rational antitrust policy: figure out who is getting hurt, and how. [ABSTRACT FROM AUTHOR]

COVID‐19 led to a recent high‐profile proposal to reintroduce oral poliovirus vaccine (OPV) in the United States (U.S.), initially in clinical trials, but potentially for widespread and repeated use. We explore logistical challenges related to U.S. OPV administration in 2020, review the literature related to nonspecific effects of OPV to induce innate immunity, and model the health and economic implications of the proposal. The costs of reintroducing a single OPV dose to 331 million Americans would exceed $4.4 billion. Giving a dose of bivalent OPV to the entire U.S. population would lead to an expected 40 identifiable cases of vaccine‐associated paralytic polio, with young Americans at the highest risk. Reintroducing any OPV use in the U.S. poses a risk of restarting transmission of OPV‐related viruses and could lead to new infections in immunocompromised individuals with B‐cell related primary immunodeficiencies that could lead to later cases of paralysis. Due to the lack of a currently licensed OPV in the U.S., the decision to administer OPV to Americans for nonspecific immunological effects would require purchasing limited global OPV supplies that could impact polio eradication efforts. Health economic modeling suggests no role for reintroducing OPV into the U.S. with respect to responding to COVID‐19. Countries that currently use OPV experience fundamentally different risks, costs, and benefits than the U.S. Successful global polio eradication will depend on sufficient OPV supplies, achieving and maintaining high OPV coverage in OPV‐using countries, and effective global OPV cessation and containment in all countries, including the U.S. [ABSTRACT FROM AUTHOR]

We apply the concept of threat points in game theory to explore the stability of current joint management arrangements for shared transboundary fish stocks between Canada and the United States. We use three examples to explore the effects of projected impacts of climate change on the productivity and distribution of these stocks between the exclusive economic zones of the two countries. The three stocks that we study are: Atlantic cod (Gadus morhua) and yellowtail flounder (Limanda ferruginea) within the Gulf of Maine, and Pacific halibut (Hippoglossus stenolepis) in the Pacific Coast. We define a threat point as the payoffs that the fisheries in Canada and the United States take home given the current management agreement between the two countries. This is an application of John Nash's threat point, defined as the minimum payoffs that each player in a game theoretic model must receive for the solution to a cooperative game to be stable, which is usually the outcome of a noncooperative game. First, we compute the threat points, that is, the current profits that Canada and the United States derive from the three shared stocks, respectively. Next, we build an ensemble of climate-marine ecosystem and economic models and use them to determine how climate change is likely to change current profits received by each country relative to the shifts in their threat points. We find that in some cases the profits obtained by fisheries in Canada and the United States would change under climate change both in absolute and relative terms resulting in relative changes in threat points. These relative changes in threat points serve as the basis for our discussion of the stability of current transboundary management agreements between Canada and the United States for these important shared stocks in the face of climate change. [ABSTRACT FROM AUTHOR]

Background: The clinical evaluation of HER2CLIMB trial showed a 21. 9-month median overall survival with the triplet regimens of tucatinib, capecitabine, and trastuzumab (TXT) for patients with human epidermal growth factor receptor 2 (HER2) –overexpressing metastatic breast cancer. From the payer's perspective of the United States and China, a cost-effectiveness analysis was conducted to evaluate the costs and benefits of adding tucatinib in this study. Methods: We constructed a Markov model for the economic evaluation of adding tucatinib to trastuzumab plus capecitabine in patients with HER-2 positive metastatic breast cancer in the United States and China. The model was conducted with a 10-year time horizon, and the health status was divided into three states: progression-free survival, progressing disease, and death. The health utility scores were consistent with published literature with similar patient status. The transition probabilities were derived from the survival data of the HER2CLIMB study. The unit prices of medicines were obtained from the West China Hospital, Red Book, and published literature. Outcomes were measured in quality-adjusted life-years (QALYs), and incremental cost-effectiveness ratio, which robustness was evaluated by deterministic and probabilistic sensitivity analyses. Results: Compared with the two-drug regimen of trastuzumab plus capecitabine (TX), the addition of tucatinib increased 0.21 QALY, with an increasing cost of $146,995.05 and $19,022.97 in the United States and China, respectively. The incremental cost-effectiveness ratios (ICERs) for the TXT versus TX was $699,976.43 in the U.S. and $90,585.57 in China, both of which are higher than their respective threshold of willingness to play. Deterministic sensitivity analysis shows that the price of tucatinib is the parameter that has the most significant impact on ICERs, but it does not change the results of the model. Probability sensitivity analysis shows that the probability of cost-effective for TXT is 0 in the base case. Conclusion: In the United States and China, tucatinib combined with trastuzumab and capecitabine is not cost-effective for patients with HER-2 positive metastatic breast cancer. [ABSTRACT FROM AUTHOR]

The declining pattern of population density from city centres to the outskirts has been widely observed in American cities. Such a pattern reflects a trade-off between housing price/commuting cost and employment. However, most previous studies in urban population density functions are based on the Euclidean distance, and do not consider commuting cost in cities. This study provides an empirical evaluation of the classic population density functions in 382 metropolitan statistical areas (MSA) in the USA using travel times to city centres as the independent variable. The major findings of the study are: (1) the negative exponential function has the overall best fit for population density in the MSAs; (2) the Gaussian and exponential functions tend to fit larger MSAs, while the power function has better performance for small MSAs; (3) most of the MSAs appear to show a decentralisation trend during 1990–2016, and larger MSAs tend to have a higher rate of decentralisation. This study leverages crowdsourced geospatial data to provide empirical evidence of the classic urban economic models. The findings will increase our understanding about urban morphology, population–job displacement and urban decentralisation. The findings also provide baseline information to monitor and predict the changing trend of urban population distribution that could be driven by future environmental and technological changes. [ABSTRACT FROM AUTHOR]

The article discusses American employers and the legal firm competition from which they developed. Topics covered include the distinction between liberal and coordinated market economies, and a comparison of the economic models of U.S. and Germany from a historical and development perspective. Also noted is the law's role in shaping these countries' models of employer organization and market economies.

Background: The United States is the only high-income nation without universal, government-funded or -mandated health insurance employing a unified payment system. The US multi-payer system leaves residents uninsured or underinsured, despite overall healthcare costs far above other nations. Single-payer (often referred to as Medicare for All), a proposed policy solution since 1990, is receiving renewed press attention and popular support. Our review seeks to assess the projected cost impact of a single-payer approach.Methods and Findings: We conducted our literature search between June 1 and December 31, 2018, without start date restriction for included studies. We surveyed an expert panel and searched PubMed, Google, Google Scholar, and preexisting lists for formal economic studies of the projected costs of single-payer plans for the US or for individual states. Reviewer pairs extracted data on methods and findings using a template. We quantified changes in total costs standardized to percentage of contemporaneous healthcare spending. Additionally, we quantified cost changes by subtype, such as costs due to increased healthcare utilization and savings due to simplified payment administration, lower drug costs, and other factors. We further examined how modeling assumptions affected results. Our search yielded economic analyses of the cost of 22 single-payer plans over the past 30 years. Exclusions were due to inadequate technical data or assuming a substantial ongoing role for private insurers. We found that 19 (86%) of the analyses predicted net savings (median net result was a savings of 3.46% of total costs) in the first year of program operation and 20 (91%) predicted savings over several years; anticipated growth rates would result in long-term net savings for all plans. The largest source of savings was simplified payment administration (median 8.8%), and the best predictors of net savings were the magnitude of utilization increase, and savings on administration and drug costs (R2 of 0.035, 0.43, and 0.62, respectively). Only drug cost savings remained significant in multivariate analysis. Included studies were heterogeneous in methods, which precluded us from conducting a formal meta-analysis.Conclusions: In this systematic review, we found a high degree of analytic consensus for the fiscal feasibility of a single-payer approach in the US. Actual costs will depend on plan features and implementation. Future research should refine estimates of the effects of coverage expansion on utilization, evaluate provider administrative costs in varied existing single-payer systems, analyze implementation options, and evaluate US-based single-payer programs, as available. [ABSTRACT FROM AUTHOR]

Despite attempts to end homelessness in the United States occurring over the past 10 years, homelessness has only been reduced by about 10%. This article introduces a theoretical model for why some individuals have gained housing and other types of services while others have not. This model incorporates both the political economy theory and the street-level bureaucracy theory to explain service gaps for homeless individuals. Using this model, this article explains major policies affecting agencies which serve the homeless. It also uses current research to explain how practitioners manage these constraints. Recommendations for social service practitioners are discussed. [ABSTRACT FROM AUTHOR]

Objective: Uncontrolled asthma is associated with considerable clinical burden and costs to payers and patients. US economic models evaluating biologics using data from clinical trials demonstrate high incremental cost-effectiveness ratios (ICERs), but the cost-effectiveness based on real-world treatment patterns is unknown. This analysis used real-world evidence to assess the cost-effectiveness of adding omalizumab to standard of care (SOC).Methods: A Markov model was applied to track patients' health states in 2-week cycles, comparing costs and treatment effects of SOC alone versus SOC + omalizumab over a lifetime (US payer perspective). Outcomes included exacerbation events, life years, quality-adjusted life years (QALYs), total costs, and an ICER. Patient characteristics, exacerbations, patient-reported outcomes, and work productivity were derived from the real-world PROSPERO (Prospective Study to Evaluate Predictors of Clinical Effectiveness in Response to Omalizumab) study. Published literature informed mortality, exacerbation-related disutility, and unit costs. Sensitivity analyses assessed model robustness.Results: Over a lifetime horizon, omalizumab was associated with an increase of 2.0 QALYs at a cost of $US 148,319 in patients with uncontrolled asthma (ICER of $75,319/QALY gained) and a reduction in exacerbations of 6.0 events/patient. Accounting for responder status improved the ICER ($70,505/QALY); incorporating indirect costs further reduced the ICER. One-way and multivariate sensitivity analyses confirmed that the base case outcome was robust to variation in inputs.Conclusions: Based on real-world outcomes, omalizumab may be cost-effective for uncontrolled asthma from the US payer perspective. Including broader evidence on treatment discontinuation, caregiver burden, and oral corticosteroid reduction from real-world studies may better reflect the effects and value of omalizumab for all healthcare stakeholders. [ABSTRACT FROM AUTHOR]

We develop a new model of multimarket trading to explain the differences in the foreign share of trading volume of internationally cross-listed stocks. The model predicts that the trading volume of a cross-listed stock is proportionally higher on the exchange in which the cross-listed asset returns have greater correlation with returns of other assets traded on that market. We find robust empirical support for this prediction using stock return and volume data on 251 non-U.S. stocks cross-listed on major U.S. exchanges. [ABSTRACT FROM AUTHOR]

This paper presents a small-sample study of the three-equation-three variable New-Keynesian macro model. While the point estimates imply that the Fed has been stabilizing inflation fluctuations since 1980, our econometric analysis suggests considerable uncertainty regarding the stance of the Fed against inflation. The canonical New-Keynesian macro model is strongly rejected by the likelihood ratio test, but we propose the direction in which it needs to be modified in order to fit the data. [ABSTRACT FROM AUTHOR]

We use two different nonparametric methods to determine whether there were multiple regimes in U.S. monetary policy over the period 1955-2003. We model monetary policy using two different versions of Taylor's rule for the nominal interest-rate target. By contrast with parametric tests for regime changes, the nonparametric methods we use allow the data to determine the dimensions on which to split the sample for purposes of estimating the coefficients of the Taylor rule. We find evidence for a few structural breaks and consistent agreement between our two nonparametric methods on the dating of those breaks. [ABSTRACT FROM AUTHOR]

We explore the link between an interest rate rule for monetary policy and the behavior of the real exchange rate. The interest rate rule, in conjunction with some standard assumptions, implies that the deviation of the real exchange rate from its steady state depends on the present value of a weighted sum of inflation and output gap differentials. The weights are functions of the parameters of the interest rate rule. An initial look at German data yields some support for the model. [ABSTRACT FROM AUTHOR]

This paper analyses the role of the real exchange rate in a structural vector autoregression framework for the United Kingdom, Euro area, Japan, and Canada vis-á-vis the United States. A new identification strategy is proposed building on sign restrictions. The results are compared to the benchmark conventional approach of Clarida and Gali (1994) based on long-run zero restrictions. Although the restrictions are derived from the same theoretical model, the results are strikingly different. In contrast to the benchmark model, an important role for nominal shocks in explaining real exchange rate fluctuations is found. Hence, the exchange rate can rather be considered as a source of shocks instead of a shock absorber. [ABSTRACT FROM AUTHOR]

We use forecast errors made by the Federal Reserve while preparing open market operations to identify a liquidity effect at a daily frequency in the federal funds market. We find a liquidity effect on most days of the reserve maintenance period in addition to settlement day. The effect is nonlinear; large changes in supply more consistently have a measurable effect than do small changes. In addition, a higher aggregate level of reserve balances in the banking system is associated with a smaller liquidity effect during the maintenance period but a larger liquidity effect on the last days of the period. [ABSTRACT FROM AUTHOR]

I develop a new approach to accounting for human capital and essentially all stock and non-stock wealth in estimating the return on wealth portfolio. Using the estimated return and aggregate U.S. data in weak-identification robust tests of the Epstein and Zin (1991) and Weil (1990) model, I find that the model can simultaneously match the historical average equity premium, risk-free rate, and stock return volatility with reasonable parameter values. [ABSTRACT FROM AUTHOR]

We quantify the welfare differential between precommitment and discretionary monetary policy in three estimated models of the U.S. economy by calculating the permanent deviation of inflation from target that in welfare terms is equivalent to moving from discretion to precommitment. Using a range of reasonable central bank preference parameters, this "inflation equivalent" ranges from 0.05 to 3.6 percentage points, with a mid-point of either 0.15 or 1-1.5 percentage points, depending on the model. In addition to the degree of forward-looking behavior, we show that the existence of transmission lags and/or information lags is crucial for determining the welfare gain from precommitment. [ABSTRACT FROM AUTHOR]

In this qualitative study, the authors offer a framework through which they examine the information use, strategic approach, and managerial control behavior in the export pricing practices of 24 firms based in Austria, Norway, and the United States. They offer propositions about export pricing behavior and suggestions for empirical research in the field. [ABSTRACT FROM AUTHOR]

We propose that stock-market participation is influenced by social interaction. In our model, any given "social" investor finds the market more attractive when more of his peers participate. We test this theory using data from the Health and Retirement Study, and find that social households--those who interact with their neighbors, or attend church--are substantially more likely to invest in the market than non-social households, controlling for wealth, race, education, and risk tolerance. Moreover, consistent with a peer-effects story, the impact of sociability is stronger in states where stock-market participation rates are higher. [ABSTRACT FROM AUTHOR]

The one-sector Solow-Ramsey model is the most popular model of long-run economic growth. This paper argues that a two-sector approach, in which technological progress in the production of durable goods exceeds that in the rest of the economy, provides a far better picture of the long-run behavior of the U.S. economy. The paper shows how to use the two-sector approach to model the real chain-aggregated variables currently featured in the U.S. National Income and Product Accounts. It is shown that each of the major chain-aggregates-output, consumption, investment, and capital stock-will tend in the long run to grow at steady, but different, rates. Implications for empirical analysis based on these data are explored. [ABSTRACT FROM AUTHOR]

This paper offers a new explanation for the prevalent use of convertible securities in venture capital finance. Convertible securities can be used to endogenously allocate cash-flow rights as a function of the state of the world and the entrepreneur's effort. This property can be used to induce the entrepreneur and the venture capitalist to invest efficiently into the project. The result is robust to renegotiation and to changes in the timing of investments and information flows. The model is consistent with the observations that conversion is often automatic and that convertible securities are rarely used by outside investors. [ABSTRACT FROM AUTHOR]

The Federal Reserve sets targets for interest rates which it enforces through direct market intervention. These targets are changed periodically. In this paper, we develop a term structure model in which the short rate is subject to a control which keeps it close to a target which changes from time to time. The probability of target changes is not constant in the model, but changes as a function of observables. The model performs well at explaining the shifts in the yield curve that accompany target changes. [ABSTRACT FROM AUTHOR]

We provide evidence that firms attempting IPOs condition offer terms and the decision whether to carry through with an offering on the experience of their primary market contemporaries. Moreover, while initial returns and IPO volume are positively correlated in the aggregate, the correlation is negative among contemporaneous offerings subject to a common valuation factor. Our findings are consistent with investment banks implicitly bundling offerings subject to a common valuation factor to achieve more equitable internalization of information production costs and thereby preventing coordination failures in primary equity markets. [ABSTRACT FROM AUTHOR]

This paper constructs a simple model of home production that demonstrates the connection between the intertemporal elasticity of substitution in market consumption (IES) and the static elasticity of substitution between home and market consumption (SES). Understanding this connection is important because there is a large body of empirical evidence suggesting that the IES is small, but little evidence on the size of the SES. We use our framework to shed light on the properties of a home production model with a low IES. We find that such a model must have three fundamental properties in order to match key aspects of aggregate U.S. data. First, the steady-state growth rate of technology must be the same across sectors. Second, shocks to technology must be sufficiently positively correlated across sectors. Third, capital must be used more intensively in the market sector than in the home sector. A home production model with these three properties can be surprisingly successful at reconciling the RBC paradigm with evidence for a low IES. [ABSTRACT FROM AUTHOR]

The article presents commentary from Zhenyu Wang about a paper written by Lubos Pastor and Robert F. Stambaugh (P&S) entitled "The Equity Premium and Structural Breaks," which appeared in the August, 2001 edition of the "Journal of Finance." In that paper P&S combined statistical procedures with economic ideas to estimate the equity premium for stocks in the U.S. The author of the current paper applauds their approach and finds their results sensible. However, he also believes they should incorporate a valuation model based on fundamental economic variables.

We show that the external habit-formation model economy of Campbell and Cochrane (1999) can explain why the Capital Asset Pricing Model (CAPM) and its extensions are better approximate asset pricing models than is the standard consumption-based model. The model economy produces time-varying expected returns, tracked by the dividend-price ratio. Portfolio-based models capture some of this variation in state variables, which a state-independent function of consumption cannot capture. Therefore, though the consumption-based model and CAPM are both perfect conditional asset pricing models, the portfolio-based models are better approximate unconditional asset pricing models. [ABSTRACT FROM AUTHOR]

This paper characterizes Federal Reserve policy since 1980 as one that actively manages short-term nominal interest rates in order to control inflation and evaluates this policy using a dynamic, stochastic, sticky-price model of the United States economy. The results show that the Fed's policy insulates aggregate output from the effects of exogenous demand-side disturbances and, by calling for a modest but persistent reduction in short-term interest rates following a positive technology shock, helps the economy to respond to supply-side disturbances as it would in the absence of nominal rigidities. [ABSTRACT FROM AUTHOR]

Research showing a negative correlation between output and prices has brought into question the conventional wisdom that prices are procyclical. However, this finding has been shown to he sensitive to the sample period considered. This paper examines the relationship in the frequency domain: the covariance of output and prices is decomposed into spectral components to investigate whether differences in the price-output relationship across sample periods reflect changes in the importance of various frequencies embedded within the correlations, or whether they reflect more fundamental changes in the entire spectral relationship. Some implications for model evaluation are also considered. [ABSTRACT FROM AUTHOR]

Like security prices, retail deposit interest rates cluster around integers and "even" fractions. However, explanations for security price clustering are incompatible with deposit rate clustering. A theory based on the limited recall of retail depositors is proposed. It predicts that banks tend to set rates at integers and that rates are "sticky" at these levels. The propensity for integer rates increases with the level of wholesale interest rates and deposit market concentration. When banks set noninteger rates, rates are more likely to be just above, rather than just below, integers. The paper finds substantial empirical support for the theory's implications. [ABSTRACT FROM AUTHOR]

This paper presents an empirical microstructure model of bid and ask quotes that features discreteness, random costs of market making, and ARCH volatility effects. Applied to intraday quotes at 15-minute intervals for Alcoa (a randomly chosen Dow stock), the results show that quote exposure costs contain stochastic components that are persistent and large relative to the deterministic intraday "U" components. Analysis of the filtered estimates of the system suggest that bid and ask costs contain common components, and that these costs reflect risk as proxied by ARCH variance forecasts. [ABSTRACT FROM AUTHOR]

Long-term estimates of expected return on equities are typically derived from U.S. data only. There are reasons to suspect that these estimates are subject to survivorship, as the United States is arguably the most successful capitalist system in the world. We collect a database of capital appreciation indexes for 39 markets going back to the 1920s. For 1921 to 1996, U.S. equities had the highest real return of all countries, at 4.3 percent, versus a median of 0.8 percent for other countries. The high equity premium obtained for U.S. equities appears to be the exception rather than the rule. [ABSTRACT FROM AUTHOR]

We study inference in shift-share regression designs, such as when a regional outcome is regressed on a weighted average of sectoral shocks, using regional sector shares as weights. We conduct a placebo exercise in which we estimate the effect of a shift-share regressor constructed with randomly generated sectoral shocks on actual labor market outcomes across U.S. commuting zones. Tests based on commonly used standard errors with 5% nominal significance level reject the null of no effect in up to 55% of the placebo samples. We use a stylized economic model to show that this overrejection problem arises because regression residuals are correlated across regions with similar sectoral shares, independent of their geographic location. We derive novel inference methods that are valid under arbitrary cross-regional correlation in the regression residuals. We show using popular applications of shift-share designs that our methods may lead to substantially wider confidence intervals in practice. [ABSTRACT FROM AUTHOR]

Technology diffusion often plays a critical role in models of trade and economic growth. Most existing empirical tests for international technology spillovers suggest some role for spillovers in explaining productivity growth. It has been relatively difficult, however, to identify separate roles for the direct and indirect channels of knowledge spillovers. The influence of these channels is often confounded owing to the focus on total‐factor productivity (TFP) and R&D spending within a cross‐section or panel data setting. This paper employs an alternative methodology to investigate the role of direct knowledge spillovers. Using citation‐weighted domestic patents, citation‐weighted foreign patents and value added for 14 U.S. manufacturing industries over the period 1977 to 2004 a panel VAR methodology is employed to investigate the dynamic role of direct and indirect knowledge spillovers. Evidence for the role of the direct knowledge spillovers channel is found—an increase in citation‐weighted patents abroad directly increases the measure of domestic citation‐weighted patents, after accounting for the influence of productivity/value added. The role of foreign innovative activity, however, is small relative to the role of U.S. innovative activity in explaining the dynamics of industry value added. [ABSTRACT FROM AUTHOR]

Introduction: Cardiovascular disease is a leading cause of mortality in people with type 2 diabetes mellitus (T2DM). Beginning in 2015, long-term cardiovascular outcomes trials (CVOTs) have reported cardioprotective benefits for two classes of diabetes drugs. In addition to improving the lives of patients, these health benefits affect relative value (i.e., cost-effectiveness) of these agents compared with each other and especially compared with other agents. While long-term CVOT data on hard outcomes are a great asset, economic modeling of the value of this cardioprotection faces many new empirical challenges. The aim of this study was to identify different approaches used to incorporate drug-mediated cardioprotection into T2DM economic models, to identify pros and cons of these approaches, and to highlight additional considerations. Methods: A review of T2DM modeling applications (manuscript or conference abstracts) that included direct cardioprotective effects was conducted from January 2015 to September 2018. Model applications were classified on the basis of the mechanism used to model cardioprotection [i.e., directly via hazard ratios (HRs) for cardiovascular outcomes or indirectly via biomarker mediation]. Details were extracted and the studies were evaluated. Results: Five full-length articles and 16 conference abstracts (of which 11 posters were found) qualified for study inclusion. While the approaches used were diverse, the five full-length publications and all but two of the abstracts modeled cardioprotection used direct HRs from the relevant CVOT. The remaining two posters modeled cardioprotection using CVOT HRs in combination with treatment effects mediated through known risk factors. Conclusion: The classification of empirical methods in cardioprotection was intended to facilitate a better understanding of the pros and cons of different methodologies. A substantial diversity was observed, though most used trial HRs directly. Given the differences observed, we believe that diabetes modelers and other stakeholders can benefit from a formal discussion and evolving consensus. Funding: Janssen Global Services, LLC (Raritan, NJ, USA). [ABSTRACT FROM AUTHOR]

The goal of this study was to examine cost impacts using techno-economic analysis (TEA) and environmental impacts using life-cycle assessment (LCA) for the production of red wine. Three production scales, denoted as "small" (5000 gal per year), "medium" (50,000 gal per year), and "large" (500,000 gal per year) were chosen for analysis. For example, the consumption of water, energy, greenhouse gas emissions, and solid waste generation were considered in order to estimate environmental impacts. A spreadsheet-based economic model was also developed. The results of the LCA and TEA were compared amongst all production scales. The results of the LCA showed that both bottle manufacturing and various wine-making processes contributed the greatest environmental impacts. For TEA, the relationships between costs and profits increased as production scale increased; exponential trend lines could describe the data, but linear models were better. This information can be useful when considering what size of winery might be appropriate to invest in, or what operational categories may be most impactful in terms of costs and environmental burdens and, thus, may be targets for efficiency improvements. [ABSTRACT FROM AUTHOR]

Acute respiratory tract infections (RTIs) of viral origin place a substantial burden on health care resources and society. Randomized controlled trials have shown positive effects of probiotics on clinical outcomes in these commonly occurring RTIs. Two meta-analyses published by the York Health Economics Consortium (YHEC) and Cochrane reported the efficacy of probiotics in reducing incidence and duration of RTIs, number of antibiotic courses, and days absent from work. The aim of this study was to assess the potential health-economic impact of probiotics on RTI-associated events and expenses in the US primary care setting. A state-transition microsimulation model reproduced a study population representative of the US national demographics for age and gender (1/1,000 sample). RTI incidence was based on the influenza-like illness outpatient consultation rate reported by the Centers for Disease Control and Prevention (CDC) FluView. Data on vaccination, on factors that negatively impact RTI outcomes, on resource utilization, and on productivity loss were obtained from US national databases. Analyses were performed for both meta-analyses independently. Outcomes included cost savings for the health care payer, related to a reduced number of RTI episodes, less outpatient consultations, and decreased medical prescriptions as well as cost savings from a broader societal perspective related to productivity loss. The analysis showed that generalized probiotic intake in the US population for 2017–2018 would have allowed cost savings for the health care payer of 4.6 million USD based on the YHEC scenario and 373 million USD for the Cochrane scenario, by averting 19 million and 54.5 million RTI sick days, respectively, compared to no probiotics. Antibiotic prescriptions decreased with 1.39–2.16 million courses, whereas absence from work decreased by 3.58–4.2 million days when applying the YHEC and Cochrane data, respectively. When productivity loss is included, total savings for society represented 784 million or 1.4 billion USD for the YHEC and Cochrane scenarios, respectively. Subgroup analyses demonstrated an incremental benefit of probiotics in at-risk groups, which might be of relevance for targeted interventions. Sensitivity analyses confirmed the robustness of the model outcomes. Our analysis demonstrated a positive impact of probiotics on the health care and economic burden of flu-like RTIs. Improved disease outcomes translated into considerable cost savings for both the payer and society. [ABSTRACT FROM AUTHOR]