SHOCKING STUFF: TECHNOLOGY,HOURS, AND FACTOR SUBSTITUTION

The response of hours to technology shocks is a key controversy in macroeconomics. We show that differences between RBC and NK models hinge on highly restrictive views of technology. We introduce CES production technologies and demonstrate that the response of hours depends on the factor‐augmenting nature of shocks and the capital–labor substitution elasticity in both models. We develop analytical expressions to establish the thresholds determining its sign. This opens new margins for shock identification combining theory and VAR evidence. We discuss how our models provide new robust restrictions for empirical work, especially using the labor income share.     

Parallel Process of Posttraumatic Stress and Externalizing Problems Among Youth at High Risk for Victimization

Research shows comorbidity between posttraumatic stress symptoms (PTSS) and externalizing problems among polyvictimized youth. However, the impact of polyvictimization on the longitudinal co-development of PTSS and distinct forms of externalizing problems remains unclear. Growth trajectory modeling was used to address this gap. At ages 8, 12, and 16, polyvictimization was measured using youth, caregiver, and official records; whereas youth self-reported PTSS and caregivers reported aggression and delinquency. Results demonstrate that changes in PTSS and each externalizing domain were independent. Further, polyvictimization and PTSS/aggression were only associated at concurrent time points. In contrast, polyvictimization and delinquency were generally associated at concurrent and distal time points, suggesting that polyvictimization may have a more enduring impact on youths' delinquent behaviors than other symptoms.     

HUMAN CAPITAL IN GROWTH REGRESSIONS: HOW MUCH DIFFERENCE DOES DATA QUALITY MAKE?

We construct estimates of educational attainment for a sample of 21 OECD countries. Our series incorporate previously unexploited information and remove sharp breaks in the data that can only reflect changes in classification criteria. We then construct indicators of the information content of our estimates and a number of previously available data sets and examine their performance in several growth specifications. We find a clear positive correlation between data quality and the size and significance of human capital coefficients in growth regressions. Using an extension of the classical errors in variables model to correct for measurement error bias, we construct a set of meta‐estimates of the coefficient of years of schooling in an aggregate Cobb‐Douglas production function. Our results suggest that the value of this parameter is likely to be above 0.60. (JEL: O40, I20, O30, C19)     

Tests of stochastic dominance with repeated measurements data

AStA Advances in Statistical Analysis - The paper explores a testing problem which involves four hypotheses, that is, based on observations of two random variables X and Y, we wish to discriminate...     

Positive coparenting previous to the COVID-19 pandemic can buffer regulatory problems in infants facing the COVID-19 pandemic

Coparenting can be a development-enhancing or risk-promoting environment for infant regulatory capacity, mainly in the presence of adversity. This study aimed to analyze the association between positive and negative coparenting previous to the COVID-19 pandemic and infant regulatory capacity in the presence of the COVID-19 pandemic, an adverse condition. A sample of 71 first-born infants and their mothers and fathers from a longitudinal cohort in Portugal were assessed at 2 weeks postpartum before the COVID-19 pandemic and again at 6 months postpartum, before (n = 35) or during the COVID-19 pandemic (n = 36). Parents completed measures of positive and negative coparenting and infant regulatory capacity in both assessment waves. Results revealed that the presence of the COVID-19 pandemic moderates the association between mothers' and fathers' positive coparenting previous to the COVID-19 pandemic and infant regulatory capacity at 6 months. The association between positive coparenting and regulatory capacity was stronger in infants facing the COVID-19 pandemic, than in infants who did not face the COVID-19 pandemic. Positive coparenting previous to the COVID-19 pandemic may be a development-enhancing environment for infant regulatory capacity in the presence of the COVID-19 pandemic. Positive coparenting may buffer regulatory problems in infants facing adverse conditions.     

A Dynamic Equilibrium Model of International Portfolio Holdings

This paper develops a continuous‐time equilibrium model of a two‐country exchange economy with heterogeneous agents and nontraded goods. Nontraded goods play the role of state variables that shift the marginal utility of traded goods. This affects prices and generates dynamic hedging demands that explain the well documented home bias puzzle in international equity portfolios. When calibrated to both consumption and production data, the model is able to generate significative home bias in equity portfolios. A new methodology, based on Malliavin calculus, is presented to solve for the portfolio policies along the equilibrium path. This methodology allows one to reduce the determination of equilibrium portfolio holdings to the solution of a linear algebraic system, rather than a partial differential equation.