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Macroeconomic Impacts of Climate Change Associated with Changes in Crop Yields

Macroeconomic Impacts of Climate Change Associated with Changes in Crop Yields

Abstract: Changes in agricultural yields due to climate change will affect land use, agricultural production volume, and food prices as well as macroeconomic indicators, such as GDP which is important as it enables one to compare the climate change impacts across multiple sectors. This study considered five key uncertainty factors and estimated macroeconomic impacts due to crop yield changes using a novel integrated assessment framework. The five factors are 1) land-use change (or yield aggregation method based on spatially-explicit information), 2) the amplitude of the CO2 fertilization effect, 3) the use of different climate models, 4) socioeconomic assumptions and 5) the level of mitigation stringency. We found that their global impacts on the macroeconomic indicator value were 0.02 - 0.06% of GDP in 2100. However, the impacts on the agricultural sector varied greatly by socioeconomic assumption. The relative contributions of these factors to the total uncertainty in the projected macroeconomic indicator value were greater in a pessimistic world scenario characterized by a large population increase and low income (0.6%) than in an optimistic scenario (0.00%).

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EU Enlargement and Migration: Assessing the Macroeconomic Impacts  WP203  June 2007

EU Enlargement and Migration: Assessing the Macroeconomic Impacts WP203 June 2007

The expansion of the EU in May 2004 to include 10 New Member States (NMS) made it possible for workers in some Central and Eastern European countries to take up work in the EU-15. Some East to West migration was anticipated as a consequence of EU enlargement due to the income gap between most EU-15 and NMS countries. However, the pattern of immigration across the EU-15 has turned out differently from expected; in part because of transitional restrictions on labour mobility imposed in many of the EU-15 countries (see e.g. Boeri and Brücker, 2005). Here we illustrate the potential macroeconomic impacts of the migration flows that are likely to have come as a result of EU enlargement. Clearly it is difficult to measure what migration might have happened had the EU enlargement in May 2004 not taken place, and hence to measure the change in migration from EU enlargement. This is for two reasons. First, there are relatively few data available on migration post enlargement to be able to disentangle an explicit EU enlargement effect. Second, the data that exist are not necessarily comparable, across countries and time, or comprehensive. Bearing

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Macroeconomic impacts of global food price shocks on the economy of Turkey

Macroeconomic impacts of global food price shocks on the economy of Turkey

In recent years, the rise in world food prices has been one of the major concerns for policymakers. In addition, some of the sources of macroeconomic fluctuations may be attributed to the change in food prices. Employing SVAR models, this study inves- tigates the macroeconomic impacts of the global food price shocks on the economy of Turkey for the period January 1980–January 2016 using monthly data. In particular, the effects of the global food price shocks on the macroeconomic fundamentals, such as RER, inflation and growth are analysed for Turkey. The result of the impulse responses shows that a shock to the food price makes Turkish Lira to appreciate and inflation to increase contempora- neously. Thus, the empirical findings of this study imply that global food prices mainly lead to changes in the macroeconomic environment. In this context, risk management systems should be developed and strengthened against food price shocks that may arise, and more emphasis should be given to the derivative markets. In addition, in the production of agricultural products, production efficiency should be improved, efficient use of production areas should be ensured, and warehouses should be constructed to provide long-term conservation of the products. The active ex- change of relevant stock exchanges should be provided for food products. Finally, it should be noted that an appropriate balance between import and export income/expenditure should be provided so that the food supply process does not have a negative impact on the country’s economy. The inflation and exchange rate, which are the macroeconomic variables in the study, are closely related to this balance and it is important in terms of contributing to or harming the economy. This is because a surplus in the level of imports can have a significant impact on countries such as Turkey, which imports on a dollar basis and exports on a euro basis. An imbalance that may arise Table 4. Impact of the food prices on macroeconomic va-

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Essays in the Application of Linear and Non-Linear Bayesian VAR Models to the Macroeconomic Impacts of Energy Price Shocks

Essays in the Application of Linear and Non-Linear Bayesian VAR Models to the Macroeconomic Impacts of Energy Price Shocks

Despite the important of China as a major economic player and energy consumer in the world, there has seen a small literature on the relationship between energy price shocks and China’s macroeconomic variables (Tang et al. [2010] Du et al. [2010], Cunado et al. [2015], Wei and Guo [2016], Herwartz and Plödt [2016] and Cross and Nguyen [2017a]). Consistent with existing literature in the US and other devel- oped economies, the standard approach to modeling energy price shocks has been to examine the effects of an exogenous, unanticipated rise in the price of imported crude oil prices (see, e.g., Hamilton [1983], Kilian [2008a, 2009, 2014], Peersman and Van Robays [2009], Peersman and Van Robays [2009], Lippi and Nobili [2012] or Baumeister and Peersman [2013b] among others). While an examination of the rela- tionship between oil price shocks and Chinese macroeconomic variables is of interest in it’s own right, a deeper investigation into the structure of China’s quarterly energy expenditure shares reveals that the use of oil prices as a proxy for modeling more general energy price shocks paints an incomplete picture. After establishing this fact, the objective of this paper is to propose a new index of quarterly energy prices, which accurately reflects both the structure of China’s total energy expenditure shares on primary commodities, along with intertemporal fluctuations in international energy prices. Once established, the index is then used alongside three key macroeconomic variables; inflation, real GDP growth and a short term interest rate, to investigate the effects of energy price shocks on China’s macroeconomy over the past two decades.

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Expected Macroeconomic Impacts of the Accession to WTO on Azerbaijan Economy: Empirical Analysis

Expected Macroeconomic Impacts of the Accession to WTO on Azerbaijan Economy: Empirical Analysis

GATT/WTO in terms of increasing international trade. Thus, he claims that GATT/WTO also causes to changing the extensive margins of international trade through establishing new trade relations beyond affecting intensive margins of trade (existing trade relationships). Some of previous studies do not take into consideration the impacts of GATT/WTO on extensive margins of trade and this leads to the underestimation of GATT/WTO impacts. Moreover, he stresses the incapability of the traditional log-linear gravity model to work with heteroskedasticity issue and “non - normal residual” which causes to misestimating the impacts of GATT/WTO over intensive margins of trade as well. After all, the research ensures strong evidence about the effectiveness of GATT/WTO in promoting trade at both extensive margins of trade throughout the first five rounds of negotiations under GATT and intensive margins of trade especially after the creation of WTO. However, P. Dutt, T. V. Zandt and I. Mihov (2013) have found positive impact of WTO membership over extensive margin but, negative impact on intensive margin of trade.

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Macroeconomic impacts of demographic change in Scotland : a computable general equilibrium analysis

Macroeconomic impacts of demographic change in Scotland : a computable general equilibrium analysis

Figures 2.1 and 2.2 show the qualitative impact of population ageing and in- migration on the labour market. These labour market changes will have major impacts on the economy overall. In particular, with an ageing population, we expect a negative effect upon competitiveness due to the increased wage, which is a key production cost. This reduced competitiveness has a negative impact on GDP. On the other hand, in-migration eases the labour market, improves competitiveness and increases GDP. However, the interactions within the economy are naturally more complex than this and are explored in the simulations reported in Sections 5 and 6. However, note that the figures reported these simulations are for time periods over which such long-run adjustment is not yet complete. Similarly, where we report period-by-period simulations, we are tracing out the adjustment path to the long-run equilibrium.

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The macroeconomic impacts of the Attiki Odos motorway in the Greek Economy: An Input–Output Analysis

The macroeconomic impacts of the Attiki Odos motorway in the Greek Economy: An Input–Output Analysis

Input -­‐   output analysis is the most common method used to estimate the short -­‐ term effects of construction spending (which mainly include construction jobs and the secondary impacts of construction). Thus, the IO model will be used to calculate relative changes in output for the entire economy, employment and occupations. We choose the widely used IO model because its implementation is straightforward, the derived results directly interpretable and the data are, usually, easy to access. However, a major limitation of the IO model is that it is static and, thus, does not account for long -­‐ term changes. In this context, the analysis is based on the typical assumption that production technology for the Greek economy remains constant.

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A Critique of “Macroeconomic Impacts of Canadian Immigration… Using the Focus Model” (Dungan, Fang and Gunderson, 2010)

A Critique of “Macroeconomic Impacts of Canadian Immigration… Using the Focus Model” (Dungan, Fang and Gunderson, 2010)

A key assumption of the simulation is that the immigration would not change the full- employment or ‘natural’ unemployment rate or ‘Non-Accelerating Inflation Rate of Unemployment’ (NAIRU), which is a key exogenous variable in the FOCUS model. This is, of course, not very plausible as recent cohorts of immigrants have had unemployment rates up to twice as high as non-immigrants. It also has an important impact on the results as employment in macroeconomic models like FOCUS have a tendency to gravitate towards the levels consistent with the assumed natural rate. In effect, they have assumed that all the new immigrants will experience the same levels of unemployment as everyone else, which has obviously not been the case as shown in the Census and Labour Force Survey data.

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Projection of Macroeconomic Impacts on The Toll Plazas Waiting Time Queueing: A Case Study In Brazil

Projection of Macroeconomic Impacts on The Toll Plazas Waiting Time Queueing: A Case Study In Brazil

SUMMARY:- This study aims to understand the flows of vehicular traffic in a toll plaza impacted by macroeconomic events. The study provides the traffic demand of commercial and small vehicles on a Brazilian highway until the year 2020. This Highway plays an important role for the oil industry and the development of the region depends mostly on it. The population, the region's Gross Domestic Product and oil production are considered as explanatory variables. The data used is divided by the toll plaza, vehicle type and area of influence. A simulation model for discrete events is used based on the actual scenario and future events. The model concludes that the amount of commercial vehicles will rise significantly, generating an increase in the queue waiting time of the toll plazas, going up to nineteen minutes. To reduce the stakeholders impact the study suggests some steps for planning the highway in the medium term.

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Macroeconomic Impacts of Climate Change Associated with Changes in Crop Yields

Macroeconomic Impacts of Climate Change Associated with Changes in Crop Yields

Figure S3 The macroeconomic impact due to mitigation policy (RCP2.6 equivalent) and agricultural yield change for RCP2.6 for five regions and the global total. All cases considered a mitigation policy, but the dotted line indicates no consideration of climate change (NoCC), while the red colored ribbon indicates the cases where the impact of climate change was considered. The red line is the median of the climate change impact cases. Regional codes are OECD90, OECD regions; Asia, Asia; REF, Reforming region; MAF, Middle East and Africa; and LAM, Latin America (The mapping procedure from 17 regions is shown in Table S1).

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Total debt servicing and macroeconomic performance in Kenya

Total debt servicing and macroeconomic performance in Kenya

The second objective of the study was to analyze the dynamic response of the variables due to innovations in total debt servicing. A VAR model was estimated and the estimation coefficients used to derive the impulse response functions of the various variables. The dynamic response was analyzed over a twenty year time horizon. From the findings, the impact of unexpected changes in total debt service lasted for long in the economy before finally fizzling out. This was observed in the various variables such as GDP, private investment, real interest rate, savings and external balance of goods and services among others. From variance decomposition analysis, TDS had feedback effects on the variables and the effects were multidirectional. The impact of the shocks increased as the forecast horizon progressed. The study thus concluded that debt servicing has significant impact on the macroeconomic fundamentals.

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Nexus Between Non-Performing Assets And Macroeconomic Variables – A Study Of Indian Banking Sector

Nexus Between Non-Performing Assets And Macroeconomic Variables – A Study Of Indian Banking Sector

The study is descriptive and investigative in nature. It evaluates the impact of macroeconomic variables on NPAs in Scheduled Commercial Banks, Public Sector Banks, Private Sector Banks and Foreign Banks in India during 1996-97 to 2015-16. By going through the path of objectives set for the study, the relevant secondary data has been collected through various sources like, Reserve Bank of India website, Trend and Progress in banking various issues. The data was analyzed by applying correlation and multiple regression as a statistical tools. Correlation is used to establish an empirical relationship

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Impacts of Macroeconomic Factors on the Stock Market in Estonia

Impacts of Macroeconomic Factors on the Stock Market in Estonia

This paper examines the relationship between the Estonian stock market index and relevant macroeconomic variables and has several focuses. First, the paper studies whether more government debt may affect the Estonian stock market index positively or negatively. More debt-financed government spending is expected to raise aggregate expenditures, create more business opportunities, and increase the demand for stocks due to the portfolio adjustment, which would increase stock prices. On the other hand, more debt-financed government spending would raise the interest rate crowding out private spending, the price level, and the future tax burden, which would reduce stock prices. Second, other relevant variables such as the exchange rate, the interest rate, the foreign stock market index and other relevant variables are considered in order to estimate their respective impacts on the Estonian stock market index. Third, the GARCH model is applied in empirical work to yield consistent and unbiased estimates.

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Irish Quarterly Macroeconomic Data: A Volatility Analysis  ESRI Research Notes 2015/2/1

Irish Quarterly Macroeconomic Data: A Volatility Analysis ESRI Research Notes 2015/2/1

This Note presents an updated assessment of the volatility of Irish quarterly macroeconomic data from 1997 Q1 to 2014 Q3. This Note follows McCarthy (2003) in highlighting the volatility of Irish quarterly macroeconomic data in an international context. The quarter-to-quarter volatility in real macroeconomic aggregates, including gross output (GDP) and gross income (GNP), remain extremely high for the Irish data. The volatility in the Irish data is greater than that displayed by all other OECD countries, except Iceland. This highlights the caution required when interpreting quarterly changes in annualised growth rates. This high level of volatility, combined with large revisions poses challenges for forecasters and policymakers.

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Nonlinear Differential Equation of Macroeconomic Dynamics for Long Term Forecasting of Economic Development

Nonlinear Differential Equation of Macroeconomic Dynamics for Long Term Forecasting of Economic Development

Economy usually fluctuates around its trend path. These fluctuations are cyclical, but irregular. Trend is the result of the factors responsible for long-term growth of the economy, such as capital inflows, manpower increase, scientific and tech- nical progress. Business cycles represent deviations of the real aggregate output from its long-term trend caused by distributed in time random supply shocks. In 1950s there were developed some elegant mathematical models of the theory of cycles based on the mechanism of interaction between the multiplier and acce- lerator [1], as well as neoclassical growth theories using the production functions [2]. They became the starting point for all subsequent research in these two cen- tral issues of macroeconomic dynamics. The main drawback of these models was an isolated consideration of growth and cyclical fluctuations, whereas the Schumpeterian theory of economic development [3] [4] states that cyclical fluc- tuations are an integral part of sustainable economic growth. Therefore, the theory of real business cycles (RBC) must necessarily include the interaction of the mechanisms of growth and cyclical fluctuations. The tenets of the discrete RBC theory were laid in the 1980s by Nobel laureates F. Kydland and E. Prescott [5]. They developed an RBC model based on stochastic dynamic model of gen- eral equilibrium. Their model included a stochastic version of the neoclassical Solow’s growth model [2]. Kydland’s and Prescott’s discrete RBC model became the basic one in macroeconomic computer simulation.

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Living with Macro financial Linkages: Policy Perspectives and Challenges for SEACEN Countries

Living with Macro financial Linkages: Policy Perspectives and Challenges for SEACEN Countries

In recent years, these macro-prudential measures have been adopted to supplement macroeconomic policy measures by the SEACEN authorities to gradually shift away from the generally expansionary policy stances during the peak of sub-prime crisis. Instead of relying on interest rate policy adjustments, a combination of loan to deposit ratio and reserve requirement policy has been enforced by Bank Indonesia, for instance, to manage credit growth and risk taking in the domestic banking sector. As in the past, the primary objectives of the recent macro-prudential measures are to manage pro-cyclicality and to reduce interconnectivity and systemic risk. To a large part, the SEACEN central banks, as in many other central banks globally, closely monitor pro- cyclical movements in debt and leverages, especially those related to asset markets such as the real estate sector. A key objective of the Singapore government, for example, is to ensure a stable and sustainable property market where prices move in line with fundamentals. In February 2010, the Loan-to-Value (LTV) limit for housing loans extended by financial institutions was lowered to 80%. To discourage speculative flipping of properties, a Seller’s Stamp Duty on all residential properties bought and sold within 1 year was introduced. In August 2010, the holding period for imposition of the Seller’s Stamp Duty was increased from one year to three years. The Singapore government also tightened measures to ensure public housing is utilised as intended, i.e. for owner occupation.

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Financial Markets and Debt Crisis in European Union: Preventing spillover effects of financial crisis between EU periphery and the eurozone

Financial Markets and Debt Crisis in European Union: Preventing spillover effects of financial crisis between EU periphery and the eurozone

Over the course of the last six years there have been three key macroeconomic developments: (a) EMU and non – EMU economies are in recession, i.e. stagdeflation (stagnation and deflation) or, better to say, “secular stagnation” – the persistent underuse of potential resources. (b) Banking industry is stable, but NPL are increasingly adding to the inherent financial instability (high public and unsustainable external debt, with currency mismatch in all sectors of national economies in non – EMU economies), and (c) recessionary dynamics and capital outflows (banks deleveraging) are contributing to sharp disinflation that is now transformed into deflationary pressures in Europe. Wage deflation was the main policy instrument after the crisis started. Deflation risk in EU and EMU was very high in 2015 & 2016 and beyond, and economic policy decision makers do not fully understand the severe negative effects of persistent and too low inflation rate. Also, since the start of recession, banking sector has been extremely liquid, but accompanied with the credit crunch and deleveraging due to the balance-sheet recession. There are, in addition to balance – sheet recession, also, key elements of paradox-of-thrift recession (aggregate demand and private consumption are contracting, while there is an increase in banks’ savings deposits by the households). High liquidity in financial system was not intermediated by the financial/banking institutions into credit activity to SMEs and corporate sector of economy (transmission mechanism failed). There are complex questions that has to be answered: how can unconventional monetary policy could be implemented in limiting adverse effects of financial instability on the monetary transmission mechanism and how to achieve the effectiveness of (targeted) monetary policy measures, as well the interaction between the non-standard policy measures and new central bank macroprudential strategies, within the framework of EU Banking Union (SSM and SRM)? Absence of credible and efficient macroprudential policies (for instance, dynamic provisioning targeted to curb the growth of particular groups of loans, such as foreign – exchange denominated loans, particularly important issue in non – EMU economies) resulted in a fragile domestic financial systems.

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The Economic and Environmental Impacts of Constructing Hydro Power Plants in Turkey:    A Dynamic CGE Analysis (2004 2020)

The Economic and Environmental Impacts of Constructing Hydro Power Plants in Turkey: A Dynamic CGE Analysis (2004 2020)

Since Turkey’s economy and population is rapidly growing, Turkey mostly meets its energy demand from imported fos- sil sources due to the very limited indigenous oil and natural gas resources. However, Turkey has abundant renewable resources especially, hydro power potential to be used for generation of electricity. But only one-third of this significant economical potential could be used. This usage seems insufficient when compared with that of European countries. In order to analyze the potential long term impacts of the hydro power expanding shock on some macroeconomic vari- ables of interest such as GDP, real consumption, real investment, exports, imports, trade balance, and carbon emis- sions, we developed TurGEM-D, a dynamic multisectoral general equilibrium model of the Turkish economy. Using TurGEM-D, we analyzed the impact of hydro power shock under policy scenario doubling hydro power generation. The simulation results show that doubling hydro power have slightly positive effects on macro indicators and carbon emis- sions for Turkish economy.

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Real Convergence in EU-15: A Comparative Analysis  of North versus South Europe

Real Convergence in EU-15: A Comparative Analysis of North versus South Europe

Macroeconomic policies can affect economic growth directly through their effect on accumulation of capital, or indirectly through their impact on the efficiency with which the factors of production are used, thus sending important signals to the private sector about the country’s authorities, in the form of efficiently managing the economy for profitable investments. Moreover, macroeconomic stability is reflected in low and stable rates of inflation (Mirestean and Tsangarides, 2009). However, considerable ambiguity surrounds the impact of the average rate of inflation on the rate of economic growth, at the theoretical level. The impact of inflation on output growth may also take place indirectly, via the inflation uncertainty channel. Friedman (1977) argues that changes in inflation induce erratic responses by

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Economic Evaluation of Climate Change Impacts on Road Transportation in Atlantic Canada

Economic Evaluation of Climate Change Impacts on Road Transportation in Atlantic Canada

Regional road transportation module represent a dynamic version of supply-demand system with equilibrium price and traffic level for the entire RRTN as endogenous variables and general price level, regional GDP, oil price, value added by the largest consumers of regional transportation and population as exogenous variables. Choice of these variables was based on microeconomic determinants of demand and supply as well as some common regional macroeconomic variables. For example, traffic level and price of transportation are pure microeconomic variables; oil price is a proxy for transportation costs while value added is a proxy for income. On the other hand, general price level in the region, GDP and population capture common macroeconomic characteristics.

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