Decomposition of the Sources of Real Exchange Rate Misalignment in Egypt: Evidence from the ARDL Model

This paper examines the behavior of the real exchange rate in Egypt over the period 1965–2018 by attempting to pursue three interrelated purposes. The first is to investigate the extent of deviations between the actual exchange rate and its equilibrium level and illustrate the magnitude of any currency misalignments. The second is to search for the different phases of over- and undervaluation of the local currency and explain the accompanying economic policies and/or factors leading to them. The third and ultimate purpose is to explore the role of transitory and permanent factors in deviating the actual real exchange rate from its equilibrium level. Understanding these factors should help in the design of economic policies directed to address the misalignment of the local currency. An autoregressive distributed lag (ARDL) bound test approach is used and conducted for both the bilateral and effective real exchange rates to achieve these three purposes during the selected period. To derive the equilibrium exchange rate estimate, the behavioral equilibrium exchange rate (BEER) approach is adopted. The findings reveal that the Egyptian pound was misaligned from its equilibrium value during most of the examined period. The results confirm the relative importance of the terms of trade and degree of openness variables in determining the equilibrium real exchange rate in Egypt followed by investment ratio and government consumption variables. The local currency witnessed a recent phase of overvaluation, which began in 2009, until the free float of the local currency in November 2016, after which, the Egyptian pound was found to have experienced a new phase of undervaluation till the end of the period examined. The findings show a considerable relative impact of fundamental-based factors over a prolonged period spanning from 1986 to 2003 and at the end of the period examined as well. Moreover, the documented results lend general support to the fact that both permanent or fundamental-based factors and short-run shocks prove to be important influential factors impacting currency misalignment in Egypt.

An objective method for predicting occurrence of pre-monsoon (March-May) thunderstorm events over Delhi using stability indices

In this paper an attempt has been made to investigate different stability indices in relation to the occurrence of thunderstorms in order to determine the critical values of these indices for Delhi (28.35° N / 77.12° E) using pre monsoon data for the years 1999 - 2004. The study shows that the critical values of Showalter Index (SI), Lifted Index (LI), K Index (KI), Total Totals Index (TTI), and Sweat Index (SWI) are respectively < 2 °C, < 0 °C, > 24 °C, > 44.5 °C and > 100 for the thunderstorm to occur over Delhi. The corresponding common critical ranges of Lifted Condensation Level (LCL), Level of Free Convection (LFC), Equilibrium Level (EL) and Precipitable Water (PW) are respectively 923 hPa – 695 hPa, 856 hPa – 504 hPa, 545 hPa – 109 hPa and 18 mm – 54 mm. Testing of critical values of indices and the corresponding common critical ranges of LCL, LFC, EL and PW during pre-monsoon seasons of the years 2005 and 2006 shows that they are matching well with the respective critical values/ranges in most of the thunderstorm days.

REAL EXCHANGE RATE MISALIGNMENTS: THE CASE OF THE INDONESIAN RUPIAH

This paper analyses the equilibrium price of the Indonesian Rupiah using the Synthetic Control Method (SCM) and assesses its misalignments. We find evidence of Rupiah misalignment, as the currency was undervalued for most periods, except for 1993-1996. This finding is robust across model specifications, predictors, and weighting. Our finding implies that keeping the exchange rate at its equilibrium level is ideal, and that policymakers can take advantage of the undervalued currency to promote economic growth via exports.

Testing Real Convergence as a Prerequisite for Long Run Sustainability

The main objective of this research is to estimate the degree of real convergence of the countries that joined the European Union between 2004–2013 as an essential precondition for sustainable accession to the Euro Area. Through this study, we tried to create a clear, real and comparative image for the downward trend in the dispersion of the GDP/capita and the speed by which countries with different integration stages achieve the real economic convergence to equilibrium level. In this respect, we tested real convergence by regression models. Further, in order to verify the robustness of the results we applied a cluster analysis. The main results show that non-Euro Area countries have a tendency to individually reduce income disparities with the Euro Area average, but do not register a convergent economic growth and do not form a homogeneous convergence cluster, unlike the newer Euro Area Member Countries. Another representative result is that the Czech Republic seems to be the best prepared country to adopt the single currency in a sustainable way, while Bulgaria is at the opposite pole.

Fed/ECB strategies renew monetary policy for the 2020s

Significance The changes aim to improve the efficiency of monetary policy in the environment of lower interest rates, inflation and growth, in which deflation, stagnation or recession are likelier risks than hyperinflation. Impacts The Fed will be more reactive to employment running below its equilibrium level than above it. The ECB will be more determined to fight deflation risks in the euro-area and less likely to raise rates when inflation runs above 2%. The more dovish stance of the ECB will be contested by its more hawkish members including the German Bundesbank.

Microfluidic Overhauser DNP chip for signal-enhanced compact NMR

Nuclear magnetic resonance at low field strength is an insensitive spectroscopic technique, precluding portable applications with small sample volumes, such as needed for biomarker detection in body fluids. Here we report a compact double resonant chip stack system that implements in situ dynamic nuclear polarisation of a 130 nL sample volume, achieving signal enhancements of up to − 60 w.r.t. the thermal equilibrium level at a microwave power level of 0.5 W. This work overcomes instrumental barriers to the use of NMR detection for point-of-care applications.

Theoretical Framework

This chapter presents the theoretical argument. It argues that national capacity is important in establishing the equilibrium level of piracy acceptable to the state. In weak or failed states, national governments are either unable or unwilling to counter piracy effectively, while more capable states have sufficient capacity to counter pirates on land and in coastal waters. Yet despite the importance of overall capacity in creating permissive conditions for piracy, it is argued that local governance determines the incidence and organization of piracy. In particular, organized piracy needs access to infrastructure and markets, suggesting that areas with some economic governance will be most attractive to pirates. Furthermore, pirates look for weakly governed areas where opportunities for collusion are plentiful. These expectations should hold most strongly for more organized forms of maritime piracy, since spontaneous, short-term opportunistic attacks could still occur in weak or strong areas.

Augmenting Employees’ Efforts in Innovation

Strong labour laws play a major role in motivating innovation among employees. It has been found in the literature that stringency of labour laws is positively linked with employees’ efforts in innovation, in particular, wrongful discharge laws (WDL). However, employees may also bring nuisance suits against employers. Usually, the result of these suits is that both parties settle with each other. Thus, even if employees are justly dismissed, they may be able to bring nuisance suits against employers and gain a settlement amount. This article investigates how the possibility of nuisance suits affects the impact of WDL on employees’ efforts in innovation. In this respect, a game-theoretic model is developed in the article to find the equilibrium level of employees’ efforts in the presence of nuisance suits, where there is a possibility of employees getting discharged from the firm. I find that if nuisance suits are a possibility, the stringency of WDL has no impact on employees’ efforts if defence cost of the firm is low; but for higher defence costs, WDL affects employees’ efforts. The efforts exerted by an employee are found to be weakly increasing in the defence costs of the firm.

Price Setting Dynamics Modeling on the One Product Market Under Uncertainty

This article discusses various options for studying the classic Evans model for assessing the dynamics of price setting for a new good in the conditions of uncertainty in the behavior of the market and the producer. The Evans model with fuzzy coefficients for supply and demand curves was used for modeling. As a result, it was found that when the level of opportunity for the parameters of the supply and demand curves change, the ranges of the equilibrium price will change, as well as the time of its establishment – the achievement of the equilibrium level. In addition, modeling was produced taking into account the lag in the supply from around the delay in the receipt of information on sales. The introduction of a fuzzy lag into the Evans model at a certain ratio of supply and demand parameters leads to significant price fluctuations, which can upset the equilibrium in the market, as well as lead to significant fluctuations in profit for the producer. The implementation of the Evans model with a lag in the proposal was carried out using the Simulink program of the Matlab. As a result of modeling, the dependences of the time for establishing the equilibrium price and the elevation of the price amplitude over its equilibrium value were obtained as a function of the opportunity’s level.

Dynamics of Simulated High-Shear Low-CAPE Supercells

High-shear low-CAPE environments prevalent in the southeastern U.S. account for a large fraction of tornadoes and pose challenges for operational meteorologists. Yet, existing knowledge of supercell dynamics, particularly in the context of cloud-resolving modeling, is dominated by moderate- to high-CAPE environments typical of the Great Plains. This study applies high-resolution modeling to clarify the behavior of supercells in the more poorly understood low-CAPE environments, and compares them to a benchmark simulation in a higher-CAPE environment. Simulated low-CAPE supercells’ main updrafts do not approach the theoretical equilibrium level; their largest vertical velocities result not from buoyancy, but from dynamic accelerations associated with low-level mesocyclones and vortices. Surprisingly, low-CAPE tornado-like vortex parcels also sometimes stop ascending near the vortex top instead of carrying large vorticity upward into the midlevel updraft, contributing to vortex shallowness. Each of these low-CAPE behaviors is attributed to dynamic perturbation pressure gradient accelerations that are maximized in low levels, which predominate when the buoyancy is small.