Maria Sophia Aguirre

Multiculturalism in a labour market with integrated economies

The rapid growth of immigration in past decades and the consolidation of economic blocks have brought to the foreground “old concerns” over the effect of immigration on native workers’ wellbeing. The “old concerns” present “new characteristics” which have led to the introduction of “multiculturalism” into the debate over immigration. Considers efficiency gains from immigration taking into consideration the “cultural diversity” involved in any immigration phenomena. In this light, examines the effect of the policies supported by the proponents of a “multicultural education” understood as an “amorphous syncretism” in the economic development of the recipient countries.

Sustainable development: why the focus on population?

Sustainable development is a policy approach that has gained quite a lot of popularity in recent years, especially in international circles. By attaching a specific interpretation to sustainability, population control policies have become the overriding approach to development, thus becoming the primary tool used to “promote” economic development in developing countries and to protect the environment. These policies, however, have failed to achieve either goal. By analyzing the theoretical underpinning of such policies as well as the available scientific research, this paper aims at bringing some light to these results. The findings suggest that, while the focus on population is not necessarily incorrect, the policies implemented are mistaken since they hamper the growth of a key element of economic development: human capital, and thus render it unsustainable.

Family, economics and the information society ‐ How are they affecting each other?

In the twentieth century many developed countries moved from an “agricultural‐based industrial society” to an “information society.” The second part of the century saw a deterioration of social conditions in many industrialized countries. The combination of these two factors has posed to countries both serious challenges and economic burdens. There is concern about the effects of the breakdown of the family on economic development and growth. These problems are magnified when considered within the context of developing economies. Recently, some developed countries have chosen to address what is at the heart of both the social deterioration and the economic problems it brings. This paper addresses two questions. First, how can the family be viewed within economic activity? Second, why are the breakdown of the family and policies that encourage this breakdown incompatible with sustainable real economic development?

Feedback Trading in Exchange-Rate Markets: Evidence from within and across Economic Blocks

This paper examines the pattern of autocorrelation of exchange rates in the EU, ASEAN, and NAFTA. We find no feedback trading within blocks among developed financial markets’ currencies, but it exists for less developed financial markets. Across blocks, no feedback trading is found. ASEAN currencies are an exception on both counts. When present, feedback trading is a destabilizing factor, and it takes place during rising volatility. Finally, the prevalence of negative feedback trading suggests that, in spite of the recent addition of new players into the market, such as mutual funds and hedge funds, the foreign exchange market is mainly influenced by informed players and/or central banks which intervene to protect their currencies.

Evidence of forward discount determinants and volatility behavior

This paper studies the components of the forward discount dynamics in Germany from 1972 to 1996. By using two different frequencies in the analysis, we find that an ARCH structure fits the monthly data well, while an EGARCH structure gives a better description of daily forward discount volatility. Results also suggest that foreign central bank reserves and portfolio investment are significant in the determination of the forward discount trend over the whole period. The causality, however, varies over time. Sign size, and persistence effects on the volatility of the forward discount are all significant, and thus, provide important information to both policy makers and operators in the market. There is also evidence that the volatility of the forward discount dropped after the Plaza Accord.

Working mothers and the supervision of their children: a value chain approach to schooling

Analyzes, by means of Porter’s Value Chain system, a possible strategy to address the problems of shared parental obligations by men and women, and in particular the supervision of children below school age and “latchkey” children. Also addresses the difficulty of employer retention of valuable working women. The business in this case consists of the schools, and the strategic business unit under study is identified as school‐age children with full‐time working parents. Suggests an extension of school hours as a solution.

Asymmetries in the conditional mean and conditional variance in the exchange rate: evidence from within and across economic blocks

The paper tests the hypothesis that both the conditional mean and the conditional variance of exchange rates are asymmetric functions of past information. This hypothesis is tested by estimating an Asymmetric Threshold GARCH model for fifteen currencies. The empirical evidence suggests that both the conditional mean and the conditional variance respond asymmetrically to past information, with an AR(1) structure within blocks and an ARMA(1,1) structure for the EU currencies against the dollar. It is found that the conditional mean is an asymmetric function of past innovations, rising proportionately more during appreciation periods within and across blocks. This implies that, on average, the market incorporates positive news (depreciations) more quickly than negative news (appreciations). The conditional variance is an asymmetric function of past innovations as well, rising proportionately more during depreciations within blocks and appreciation periods across blocks. Furthermore, asymmetries in the conditional mean are linked to asymmetries in the conditional variance because the more rapid adjustment of the market to depreciations causes greater volatility during these periods. This, in turn, causes within blocks a slower speed of adjustment in the variance to devaluations than to appreciations. Finally, greater efficiency in currency markets is found within blocks than across blocks.

Forward discount dynamics in integrated markets

Abstract This paper models the excess return or forward discount (premium) dynamics in integrated markets. Its decomposition at different time frequencies suggests that both stochastic and fundamental processes, as well as exogenous random shocks, are relevant for the determination of the forward discount (premium) over time. A stochastic process within a time-dependent parabolic well appears to capture the empirical findings of the literature and provides the means for the derivation of the equilibrium pricing formula for the forward discount. The mathematical solution that determines the relationship between the stochastic process and the trend allows for an interpretation of the reasons why, in some cases, expectational error appears to be correlated with the forward discount (premium) but not with the forward risk premium. Finally, estimations of the forward discount are carried out using the proposed model, which seems to support the data well.

Exchange rate dynamics in integrated markets

This paper intends to formalize the behavior of exchange rate dynamics in integrated markets. The decomposition of the exchange rate behavior in different time frequencies suggests that both stochastic and fundamental processes as well as exogenous random shocks are present in the determination of the nominal exchange rate dynamics in integrated countries. A stochastic process within a potential well captures all the elements observed in the data. In addition, the mathematical solutions shed some light on the relationship between the stochastic process and the drift found in the literature. Finally, this model provides an alternative to the Standard Target Zone Stochastic Model thus far used to analyze the exchange rate dynamics in integrated markets.

EU, ASEAN and North American Integration: Lessons from Their Degrees of Integration

This paper contrasts the EU, ASEAN and NAFTA integrations, analyzing their institutional integration, their implementation, and their impact on growth and financial markets of the member countries. In particular, the paper studies whether different degrees of financial integration affect the reception and transmission of spillovers effect inside and outside blocs. Although more detailed structural specifications are found for Europe and North America, ASEAN’s style of integration has improved the Pacific countries’ trade, growth and financial markets, and it provides important information for the achievement of economic integration. It suggests that when trade agreements exist with heavy capital investment within the bloc, faster growth and financial stability are achieved.