Structural Panel Bayesian VAR with Multivariate Time-Varying Volatility to Jointly Deal with Structural Changes, Policy Regime Shifts, and Endogeneity Issues

This paper improves a standard Structural Panel Bayesian Vector Autoregression model in order to jointly deal with issues of endogeneity, because of omitted factors and unobserved heterogeneity, and volatility, because of policy regime shifts and structural changes. Bayesian methods are used to select the best model solution for examining if international spillovers come from multivariate volatility, time variation, or contemporaneous relationship. An empirical application among Central-Eastern and Western Europe economies is conducted to describe the performance of the methodology, with particular emphasis on the Great Recession and post-crisis periods. A simulated example is also addressed to highlight the performance of the estimating procedure. Findings from evidence-based forecasting are also addressed to evaluate the impact of an ongoing pandemic crisis on the global economy.

Asymmetric Patterns of Demand-Supply Mismatch in Real Estate

As expectations change, we may observe asymmetry in responses of economic agents over various phases of the economic cycles. In this paper, we analyze both demand and supply side information to understand the dynamics of price determination in the real estate market and examine the relationship between expectation parameters and demand-supply mismatch. Our hypothesis builds on the possibility that investors’ call for action in terms of their buy/sell decision and adjustment in reservation prices may provide valuable insights into impending demand-supply imbalances in the market. We study several real estate sectors to inform our analysis. The timeframe of our analysis (1995–2010) allows us to observe market dynamics over several economic cycles. We test our hypothesis variously using several measures of market activity within a structural panel VAR framework. Our analysis suggests that investors’ attitude may have substantial and statistically significant feedback effects in price determination. These results indicate noticeable asymmetry in responses during the boom, normal and recessionary periods.

On The Contribution of Interest Expense (Income) on Total Output

A decrease in interest rate in traditional view of monetary policy transmission is linked to a lower cost of borrowing which eventually results into a greater spending in investment and a bigger GDP. However, a decrease in interest rate is also linked to a decrease in interest income which, in turn, affects the aggregate demand and total GDP. So far, no concerted effort has been made to investigate this positive inter-relation between interest income and GDP in the existing literature. Here in the first place we intuitively describe the inter-relation between interest income and output and then provide a micro-foundation of our intuitive reasoning in the context of a small endowment economy with finitely-lived identical households. Then we try to uncover the impact of nominal interest income on the macroeconomy using multiplier theory for a panel of some 04 (four) OECD countries. We define and calculate the corresponding multiplier values algebraically and then we empirically measure them using impulse response analysis under structural panel VAR framework. Large, consistent and positive values of the cumulative multipliers indicate a stable positive relationship between nominal interest income and output. Moreover, variance decomposition of GDP shows that a significant portion of the variance in GDP is attributed to interest income under VAR/VECM framework. Finally, we have shown how and where our analysis fits into the existing body of knowledge.

Structural Performance of Straw Block Assemblies under Compression Load

Background: In recent decades, the enduring interest and continued development of straw bale as a walling material are based on its beneficial properties. Straw bale is a biomaterial that contributes greatly to carbon footprint reduction and offers excellent thermal insulation. It is proved that plastered straw bale assemblies have good mechanical properties and can be used for the construction of a single storey building. It is known that straw bale presents high displacement in the assemblies; thus, pre-compression is a major step that helps to push down straw bale so as to avoid future structural failure in the wall. There is no clue yet if this method is structurally beneficial than to stabilized single straw bales before assembling them into a structural panel. Objective: This paper presents the structural performance of straw block assemblies under compression loads. Method: Straw blocks and mortar were used to construct plastered and un-plastered wall panels, which were tested under uniformly distributed compression load till failure. Results: The results obtained show that plastered straw block assemblies can support at least 286 KN/m2, which is higher than the minimum slab load 18.25KN/m2, including imposed load for a residential house. In addition, the strength of plastered straw block assemblies plastered with cement-gum mortar, 0.3 N/ mm2 is greater than the strength of a single storey building (0.19N/mm2). Furthermore, results indicate that un-plastered and plastered straw block assemblies perform better than un-plastered and plastered straw bale assemblies. Plastered straw block assemblies support up to 52KN while plastered straw bale assemblies support only 41.1KN. Conclusion: Under compression load, straw block assemblies have a load carrying capacity greater than the minimum slab load. Therefore, Straw block can be used for the construction of a single storey building.

Updated Seismic Fragility Functions for Cold-Formed Steel Framed Shear Walls per FEMA P-58 Methodology

Performance-based earthquake engineering (PBEE) provides a robust alternative to traditional earthquake design. PBEE enables engineers to estimate expected damage, repair costs, and economic losses due to downtime for a candidate design, potentially leading to novel new designs or retrofit solutions. With the increasing application of light-frame structural systems, such as cold-formed steel (CFS) panels, in residential and commercial construction, it is necessary to develop and employ fragility functions for these systems to enable PBEE. In this regard, a set of fragility functions was previously developed by researchers based on a series of monotonic and cyclic tests for CFS framed shear walls with wood structural panel sheathing, flat strap X-bracing, and steel sheet sheathing. Recently, the senior author has led in the development of a large database of CFS framed shear wall tests, including 617 monotonic and cyclic tests conducted in the last 20 years from 25 primary sources. Based on the wider database, the fragility functions for CFS framed shear walls are re-evaluated. The developed fragility functions provide updated knowledge for application of PBEE per the FEMA P-58 methodology and are recommended for future use.

A new empirical approach for balance sheet management effects on performance and financial variables development

Purpose The purpose of this paper is to estimate empirically and by empirical means, the empirical effect of the balance sheet management at the zero lower bound on the interest rate on performance and financial variables. Design/methodology/approach The paper has an empirical approach to examine whether the movement in the balance sheet has had a spillover effect on the performance and financial variable. The empirical method used is a “structural panel management,” being appropriate for the analysis. This has never been used in strategic and management development. Findings The paper presents the following interesting results: the balance sheet management explains a significant portion of the changes in performance and financial variable during the non-conventional strategy approach; the performance fundamentals as the development and the opening of the financial market deal with the heterogeneity of the business in relation to the responses of the balance sheet shocks; the positive advantage of the balance sheet management may not be profitable in context characterized by low liquidity, low exposure to global markets and low stability of performance fundamentals. Originality/value Based on a heterogeneous structural panel data management over a sample spanning the balance sheet management model, the author find some evidence of small cross-border effects on the decline of long-term bond yield, an increase in performance, an increase in the stock market prices, local currency appreciation and increase in credit growth. Yet, the quantile responses show that there is substantial heterogeneity in the Asia pacific business market responses to the governance’s shocks over all response periods. Accordingly, the effects vary across Asia pacific market and are time-varying, depending on their performance fundamentals, exposure to global markets and financial market depth. The balance sheet management on performance and financial variables could be an excellent reference for future researches and practices in Schools of Management and Finances.

International Co-movements and Business Cycles Synchronization Among Advanced Economies: A SPBVAR Evidence

This paper provides new empirical insights in order to give a relevant contribution to the more recent literature on international transmission of shocks and on business cycles synchronization across developed economies, with a particular emphasis in the most recent recession and post-crisis consolidation. Interdependence, commonality and heterogeneity in macroeconomic-financial linkages are also identified in order to depict the perplexed nature of modern economies. A time-varying Structural Panel Bayesian Vector Autoregression (SPBVAR) model is developed to deal with model misspecification and unobserved heterogeneity problems when studying multicountry dynamic panels. The results argue for significant synchronization behind a relevant consolidation without delay. Additionally, consolidation is needed to underpin confidence in fiscal solvency at the country level and prevent adverse international externalities. My evidence calls for more integrated macroprudential and financial stability policies. It also shows that, when formulating policies or forecasting, additional transmission channels and economic-institutional issues through which fiscal contractions influence the dynamics of the GDP growth need to be accounted for in muticountry setups.