Takashi Kano

A Structural VAR Approach to the Intertemporal Model of the Current Account

The intertemporal current account approach predicts that the current account of a small open economy is independent of global shocks, and that responses of the current account to country-specific shocks depend on the persistence of the shocks. This paper shows that these predictions impose cross-equation restrictions (CERs) on a structural vector autoregression (SVAR). To test the CERs, this paper develops identification schemes of the SVAR that exploit the orthogonality of the world real interest rate and country-specific shocks as well as the lack of a long-run response of net output to transitory shocks. Tests of the SVAR reveal two puzzling aspects of the Canadian and U.K. current account: (i) the response of the current account to a country-specific transitory shock is too large and (ii) the fluctuations in the current account are dominated by country-specific transitory shocks that explain almost none of the fluctuations in net output growth. These results imply the crucial role of consumption-tilting factors in explaining current account fluctuations of the two economies.

Direct action of melatonin of testosterone and cyclic GMP production using rat testis tissue invitro

Summary The direct effects of melatonin on both testosterone production and cyclic nucleotide concentrations were studied using rat testis tissue in vitro . Melatonin inhibited testosterone production and stimulated both guanylate cyclase activity and c-GMP production, while c-AMP levels remained unchanged. These effects of melatonin on the testis appear to involve the Leydig cell fraction. It is suggested that melatonin acts directly on Leydig cell fraction to activate its guanylate cyclase, which converts GTP to c-GMP stimulating c-GMP production. Melatonin also inhibits steroidogenesis in rats testis tissue in vitro .

Exchange Rates and Fundamentals: Closing a Two-country Model

In an influential paper, Engel and West (2005) claim that the near random-walk behavior of nominal exchange rates is an equilibrium outcome of a variant of present-value models when economic fundamentals follow exogenous first-order integrated processes and the discount factor approaches one. Subsequent empirical studies further confirm this proposition by estimating a discount factor that is close to one under distinct identification schemes. In this paper, I argue that the unit market discount factor implies the counter-factual joint equilibrium dynamics of random-walk exchange rates and economic fundamentals within a canonical, two-country, incomplete market model. Bayesian posterior simulation exercises of a two-country model based on post-Bretton Woods data from Canada and the United States reveal difficulties in reconciling the equilibrium random-walk proposition within the two-country model; in particular, the market discount factor is identified as being much lower than one.

Tests of the present-value model of the current account: a note

Using a Monte Carlo approach, we evaluate the small-sample properties of four different tests of the present-value model (PVM) of the current account: the nonlinear Wald, linear Wald, Lagrange multiplier and likelihood ratio tests. We find that the nonlinear Wald test is biased towards over-rejecting the cross-equation restrictions implied by the PVM, and that the test statistic is uncorrelated with the goodness of fit of the PVM. The three alternative tests are essentially equivalent and are more reliable in evaluating the PVM.

Trend Inflation and Exchange Rate Dynamics: A New Keynesian Approach

The paper studies exchange rate implications of trend inflation within a two-country New Keynesian (NK) model under incomplete international financial markets. A NK Phillips curve generalized by trend inflation with a positive long-run mean implies an expectational difference equation of inflation with higher-order leads of expected inflation. The resulting two-country inflation differential is smoother, more persistent, and more insensitive to a real exchange rate. General equilibrium then yields (i) a persistent real exchange rate with an autoregressive root close to one, (ii) a hump-shaped impulse response of a real exchange rate with a half-life longer than four years, (iii) a volatile real exchange rate relative to cross-country inflation differential, (iv) an almost perfect co-movement between real and nominal exchange rates and (v) a sharp rise in the volatility of a real exchange rate from a managed nominal exchange rate regime to a flexible one within an otherwise standard two-country NK model. Trend inflation, therefore, approaches empirical puzzles of exchange rates dynamics.

The Price of Distance: Producer Heterogeneity, Pricing to Market, and Geographic Barriers

This study investigates the effect of distance on price differentials across regions. To identify the distance effect, we need to incorporate producer heterogeneity and pricing-to-market behavior. Because geographic barriers alter the threshold levels of productivity to set a positive price across markets, the effect of distance on price differentials can be underestimated if heterogeneity and pricing to market are not accounted for. By incorporating these factors, empirical analysis using micro-level data reveals that the distance effect is significantly large, suggesting that the price of geographic barriers is still high for regional transportation.

Tests of the Present-Value Model of the Current Account: A Monte Carlo Study

Using a Monte Carlo approach, we evaluate the small-sample properties of four different tests of the present-value model (PVM) of the current account: the non-linear Wald, linear Wald, Lagrange multiplier, and likelihood ratio tests. We find that the non-linear Wald test is biased towards over-rejecting the cross-equation restrictions implied by the PVM, and that the test statistic is uncorrelated with the goodness of fit of the PVM. The three alternative tests are essentially equivalent and are more reliable in evaluating the PVM.

Radioimmunoassay for Plasma Betamethasone and Its Application for Clinical Study

A sensitive and specific radioimmunoassay for plasma betamethasone has been developed. The antiserum used was obtained by immunizing rabbits with betamethasone-3-oxime-human serum albumin (BM-3-oxime-HSA) conjugate. The sensitivity was 20 pg and a standard curve was established with a useful range from 20 pg to 4 ng. The cross reactivity of all tested endogenous steroids was less than 0.2%. Cortisol with a cross reactivity of 0.14% caused slight interference at very high concentrations, but this factor is negligible when plasma cortisol level is less than 30 microgram/dl. The calculated interference by cortisol was less than 10%, and plasma not receiving BM consistently gave blanks which were less than 20 pg/tube. Reliability criteria were satisfactory. By this method plasma BM could be measured directly in dichloromethane extract of plasma. The plasma concentrations of BM were measured in normal subjects and patients with liver diseases following oral administration of BM. The peaks of the plasma concentrations for 1.0 mg and 1.5 mg of BM were 345 +/- 40 (n = 3) and 710 +/- 200 ng/dl (n = 5) respectively within 2 hours after administration in normal subjects. After the peak level, plasma BM rapidly fell and disappeared 24 hours after administration in all examined normal subjects. In patients with chronic active hepatitis, the peak levels for 1.0 mg and 1.5 mg of BM were 428 +/- 48 (n = 4) and 837 +/- 83 ng/dl (n = 7) respectively within 2 hours after administration. However, the peak levels of plasma BM were higher than those of normal subjects, and the disappearance of BM from the blood was markedly delayed, reaching a level of 318 +/- 88 nad 622 +/- 148 ng/dl respectively for 1.0 mg and 1.5 mg of BM at 5 hours. The relatively high plasma concentration of BM, ranging from 135 to 170 ng/dl was maintained even 24 hours after administration in all patients with chronic active hepatitis. The disappearance of cortisol from the blood also rapidly fell in normal subjects, but was markedly delayed in patients with chronic active hepatitis. There was good correlation between the severity of the liver disease as measured by the ICG retention at fifteen minutes and removals of BM and cortisol from the blood.