Monday, November 29, 2010

Special Seminar!

Office of the Provost
and
Department of Economics, CAS

Co-Sponsor a Lecture by:
Peter B. Doeringer
Boston University

Title:

Can Small-Scale Industries Be Rescued from Industrial Decline?
Labor Market Regulation, Workplace Efficiency,
and Economic Performance in the Los Angeles
and New York Garment Districts

Wednesday, December 1, 2010
12-1:30 p.m.
East Quad Building Lounge


Monday, November 15, 2010

Seminar, November 17

Robin Lumsdaine will be presenting her work: "The Relationship between Oil Prices and Breakeven Inflation Rates."

The seminar is in Kreeger 101 and runs 12PM-1:15PM.

An abstract of the research:

This paper explores the role of oil prices in the inflation-linked bond markets. Early proponents of inflation-linked bonds highlighted their role in protecting against future inflation, portfolio diversification, asset-liability matching, and use as a commitment tool for monetary policy in keeping inflation contained. From an investment perspective, real return assets should be attractive in prolonged periods of high inflation and unattractive in periods of low inflation resulting in increased demand for real return assets as inflation expectations grow and decreased demand as such expectations diminish. The late 1990s and early 2000s saw an expansion in the inflation-linked bond markets, with more sovereign issuers, increased issuance size and a wider range of maturities; this tremendous growth in turn fueled greater interest and participation in these markets. After a prolonged period of low and stable inflation, the rise in oil prices that began in 2003/4 coincided with the rapid expansion of the inflation-linked bond markets and the start of the Federal Reserve’s tightening cycle. In addition, the widening of the yield spread between nominal and inflation-linked bonds, or "breakeven", during this time was seen as an indication that inflation expectations were on the rise. Much of the runup in breakevens was attributed to the observed increases in oil prices. Yet despite similar trends, over most of the sample period, breakevens and oil have not moved one-for-one. Recently, however, the decline in oil prices has coincided with a dramatic decline in breakevens and unprecedented Fed easing. The results demonstrate that the coincidence of breakeven and oil price fluctuations is a relatively recent phenomenon, unique to the US market, and mainly associated with the front end of the breakeven curve.

Tuesday, November 2, 2010

Seminar, Wednesday November 3

This Wednesday Jennifer Poole (UC Santa Cruz) is presenting her work, "Trade Liberalization, Firm Heterogeneity, and Wages: New Evidence from Matched Employer–Employee Data."

The seminar is 12PM-1:15PM in Kreeger 101.

Abstract:

In this paper, we use a linked employer–employee database from Brazil to examine the heterogeneous responses of exporters and non-­exporters to trade reform. We begin our analysis at the firm level and estimate how average wages respond to trade liberalization and test whether these responses vary by the firm’s export status. We find that wages at exporting firms increase relative to non-­‐exporters in response to a decline in protection and that the differential impact is mainly due to exporters in sectors in which Brazil has the comparative advantage. We then decompose firm-level average wages into a component reflecting the firm’s workforce composition and a component reflecting the firm’s performance. Our decomposition suggests the relative increase in wages is largely due to the portion of wages that can be attributed to the relative performance improvement at exporters post-­‐liberalization; differential changes in unobservable workforce composition play a minor role in explaining the differential response to liberalization by firms with differing trade orientation. Our worker-level analysis, where we test for the differential impacts of trade liberalization on otherwise identical workers employed in heterogeneous firms, is supportive of this finding.