Monetary Economics

Exchange. The research method uses quantitative methods from secondary data of financial analysis on 16 companies from 30 companies on the IDX Index that have a high level of liquidity and have a large capitalization selected by the IDX (Indonesia Stock Exchange) with several selection criteria, the selection is carried out by the IDX regularly 2 times every year, namely in February and August. from 2014-2018 and data from Bank Indonesia on economic growth and inflation in the same year. The data analysis technique used multiple regression. The results show that the influence of external factors in the form of economic growth and inflation is more dominant than the company's internal factors in the form of DY (Dividend Yield), EPS (Earning Per Share), ROE (Return On Equity), PER (Price Earning Ratio) affect stock returns. Implementation for companies that go public needs to pay attention to the dynamics of environmental changes, especially the inflation rate which can cause investors to sell their shares, while this phenomenon is an opportunity for some investors to get a cheaper share price than many other investors have released.

This study aims to determine the comparison of external and internal influences on stock returns on the Indonesia Stock Exchange. The research method uses quantitative methods from secondary data of financial analysis on 16 companies from 30 companies on the IDX Index that have a high level of liquidity and have a large capitalization selected by the IDX (Indonesia Stock Exchange) with several selection criteria, the selection is carried out by the IDX regularly 2 times every year, namely in February and August. from 2014-2018 and data from Bank Indonesia on economic growth and inflation in the same year. The data analysis technique used multiple regression. The results show that the influence of external factors in the form of economic growth and inflation is more dominant than the company's internal factors in the form of DY (Dividend Yield), EPS (Earning Per Share), ROE (Return On Equity), PER (Price Earning Ratio) affect stock returns. Implementation for companies that go pu...

The on-going debate about income and wealth inequality has recently hit the sphere of monetary policymaking: some analysts argued that the quantitative easing would benefit the rich at the expense of the poor, whereas some argued the contrary. This briefing paper reviews the arguments on both sides, while going back to the relationship between conventional monetary policy and income inequality. An empirical test on the Euro area shows that monetary policy has an impact on the unemployment rate, hours worked and the inflation rate. We interpret it as a positive, though relatively minor, effect of conventional and unconventional monetary policies on equality in the Euro area.

I am grateful to Alan Blinder, David Romer, Lutz Kilian, conference participants, and an anonymous referee for helpful comments on an earlier draft of this paper, and to Davide Bertoli for supplying the Blanchard-Galí data and code. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

We use the database leak of Mt. Gox exchange to analyze the dynamics of the price of bitcoin from June 2011 to November 2013. This gives us a rare opportunity to study an emerging retail-focused, highly speculative and unregulated market with trader identifiers at a tick transaction level. Jumps are frequent events and they cluster in time. The order flow imbalance and the preponderance of aggressive traders, as well as a widening of the bid-ask spread predict them. Jumps have short-term positive impact on market activity and illiquidity and induce a persistent change in the price.

Lutfia Agustin Panigoro. 931 411 244. 2015. Pengaruh Tingkat Inflasi Terhadap Return Saham Perusahaan BUMN Yang Terdaftar Di BEI. Skripsi Program Studi S1 Manajemen, Jurusan Manajemen, Fakultas Ekonomi dan Bisnis. Universitas Negeri Gorontalo, di bawah bimbingan Ibu Dewi Indrayani Hamin, SE., MM dan Bapak Idham M. Ishak, SE., M.Si. Penelitian ini bertujuan untuk menganalisis pengaruh dari inflasi terhadap return saham perusahaan BUMN yang terdaftar di BEI. Jumlah populasi dalam penelitian sebanyak 20 perusahaan BUMN, kemudian pengambilan sampel menggunakan metode purposive sampling. Sehingga jumlah sampel penelitian terdiri dari dari 15 perusahaan BUMN. Metode analisis data yang digunakan dalam penelitian ini adalah analisis regresi data panel dan uji hipotesis menggunakan uji t yang sebelumnya telah dilakukan uji asumsi klasik terlebih dahulu. Analisis data menggunakan bantuan program E-Views 6. Hasil penelitian menunjukkan bahwa Inflasi tidak berpengaruh terhadap Return Saham peru...

ABSTRAK Rahmawati mohungo, Nim 931 410 209. "Pengaruh Perubahaan Inflasi, Dana Pihak Ketiga, dan Tingkat Suku Bunga Kredit modal Kerja terhadap Kredit Modal Usaha, Studi Kasus Pada Bank Umum di Gorontalo, Periode 2010-2013. Skripsi, Program Studi S1 Manajemen Jurusan Manajemen, Fakultas Ekonomi dan Bisnis, Universitas Negeri Gorontalo. Dibawah bimbingan Bapak Raflin Hinelo., S.Pd. M.Si selaku pembimbing I dan Ibu Dewi Indrayani Hamim., SE., MM selaku pembimbing II. Penelitian ini bertujuan untuk mengetahui pengaruh perubahaan Inflasi, Dana Pihak Ketiga, dan Tingkat Suku Bunga Kredit modal Kerja terhadap Kredit Modal Usaha, Studi Kasus Pada Bank Umum di Gorontalo, Periode 2010-2013. Model analisis yang dipakai dalam penelitian ini adalah model analisis berganda dengan metode uji t dan uji F. Berdasarkan Hasil penelitian menunjukkan bahwa secara simultan Inflasi, Dana Pihak Ketiga, dan Tingkat Suku Bunga Kredit modal Kerja memiliki pengaruh signifikan sebesar 0,907 atau 90,7%. Da...

Large value payment and securities settlement systems are important components of an economy's nancial system. Many such systems are operated by central banks and are liquidity intensive. Central banks often provide inexpensive liquidity to facilitate settlement. This leads to a number of policy questions about the provision of such liquidity. To answer these questions, central banks need to understand what factors in uence the timing of settlement. This paper o ers a model to better understand intraday patterns of settlement and identi es three factors that in uence the timing of settlement: the cost of intraday liquidity, a participant's exposure to settlement risk, and system design. Incorporating all three factors enables our model to explain a number of stylized facts concerning behavior within the Federal Reserve's Fedwire fund and securities systems around a major policy change. In particular, the model captures the di erent responses of the two systems in both the pattern of settlement and the use of intraday liquidity. The results map out how policy interacts with participants' incentives to in uence the use of intraday liquidity and the resultant credit exposure of a central bank. The model, therefore, can inform decision-making at central banks.

I explore alternative central bank policies for liquidity provision in a model of payments. I use a mechanism design approach so that agents' incentives to default are explicit and contingent on the credit policy designed. In the …rst policy, the central bank invests in costly enforcement and charges an interest rate to recover costs. I show that the second best solution is not distortionary. In the second policy, the central bank requires collateral. If collateral does not bear an opportunity cost, then the solution is …rst best. Otherwise, the second best is distortionary because collateral serves as a binding credit constraint.

The enterprise value (EV) is a crucial metric in company valuation as it encompasses not only equity but also assets and liabilities, offering a comprehensive measure of total value, especially for companies with diverse capital structures. The relationship between economic uncertainty and firm value is rooted in economic theory, with early studies dating back to Sandmo's work in 1971 and further elaborated upon by John Kenneth Galbraith in 1977. Subsequent significant events have underscored the pivotal role of uncertainty in the financial and economic realm. Using a VAR-MIDAS methodology, analysis of accumulated impulse responses reveals that the EV of air carrier firms responds heterogeneously to financial and economic uncertainties, suggesting unique coping strategies. Most firms exhibit negative reactions to recessionary risks and economic policy uncertainties. Financial shocks also elicit varied responses, with positive impacts observed on EV in response to increases in the current ratio and operating income after depreciation. However, high debt levels are unfavorably received by the market, leading to negative EV responses to debt-to-asset ratio shocks. Other financial shocks show mixed or indeterminate impacts on EV.

We study the dynamic responses of key macroeconomic variables to money supply and bank rate shocks in the UK economy. Our study follows for recent decades that include the financial crisis of 2008. The Bank of England followed the Fed in taking an active role in managing the bank rate in the UK and employed quantitative easing during and post financial crisis in 2008. Our work isolates the structural shocks to the money supply and the bank rate. We examine the impulse responses of the bank rate, exchange rate, prices levels, and the industrial production deploying a structural vector autoregressive model (SVAR). The variance decomposition results and impulse responses from the VECM and SVAR models show that the industrial production is responsive to monetary actions of the Bank of England.

Research in economics and finance documents a puzzling negative relationship between stock returns and inflation rates in markets of industrialized economies. The present study investigates this relationship for Korea and Mexico. We show that the negative relationship between the real stock returns and unexpected inflation persists after purging inflation of the effects of the real economic activity. Johansen and Juselius cointegration tests verify that the long-run equilibrium between stock prices and general price levels is weak. However, in both economies, stock prices and general price levels seem to show a strong long-run equilibrium with the real economic activity. (JEL E31, G I2)

This paper investigates the relationship between equity and mortgage real estate investment trust (REIT) returns and inflation. The objective is to establish whether securitized real estate investments provide a reliable inflation hedge. Regression results show that real REIT returns are negatively correlated with the unexpected component of inflation. Therefore, equity and mortgage REIT investments may not offer a safe haven during inflationary periods. Chow tests confirm that there is evidence of a decoupling of REITs from the general stock market for more recent intervals. Fama's proxy hypothesis is also tested: the negative relationship between REITs and inflation is symptomatic of a positive relationship between REITs and real economic activity. However, no support is found for this hypothesis.

This paper investigates the uncovered interest parity theory for the three emerging markets of Korea, the Philippines, and Thailand. The study provides evidence on the efficiency of the currency markets of these economies. In this paper we test for the uncovered interest parity because futures markets for currencies of most emerging markets are not well developed. Furthermore, short-term exchange rate supply and demand are often dominated by the uncovered international investments. Several statistical tests are applied in an attempt to detect evidence of uncovered interest parity. We find there is evidence that the currencies of higher interest rate emerging economies tend to depreciate in the future spot market. However, our test results indicate that this relationship does not support the uncovered interest parity strictly. Arbitrage opportunities remain for a longer periods than predicted by the uncovered interest parity. Furthermore, these abnormal gains are not random and could be predicted by a well designed econometric model. These findings are consistent with empirical findings surrounding uncovered interest parity for mature markets of the world. Recent summaries of empirical evidence show support for covered IRP among the United States, Japan, and most European countries in that there is generally an offsetting relationship between interest rates and

Research in economics and finance documents a puzzling negative relationship between stock returns and inflation rates in markets of industrialized economies. The present study investigates this relationship for Korea and Mexico. We show that the negative relationship between the real stock returns and unexpected inflation persists after purging inflation of the effects of the real economic activity. Johansen and Juselius cointegration tests verify that the long-run equilibrium between stock prices and general price levels is weak. However, in both economies, stock prices and general price levels seem to show a strong long-run equilibrium with the real economic activity. (JEL E31, G I2)

This paper investigates the relationship between the US monetary base and the five largest equity indices of the world. The mainstay of the study is the vector autoregressive approach (VAR). Analyzing impulse response functions shows strong support for the notion that the US monetary base is associated with movements in the major equity markets. For instance, positive shocks to the monetary base in the US, are responsible for positive changes in the world equity markets that may last up to six months. Examining impulse responses of equity indices from a Markov Switching VAR, which takes regime changes into account, confirm these findings. Furthermore, we show that equity responses to the positive shocks to the monetary base may be much higher than those to negative shocks. We conclude the US monetary base, and quantitative easing may have contributed to a positive business and credit climate in advanced economies of the world.

This paper investigates the relationship between the US monetary base and the five largest equity indices of the world. The mainstay of the study is the vector autoregressive approach (VAR). Analyzing impulse response functions shows strong support for the notion that the US monetary base is associated with movements in the major equity markets. For instance, positive shocks to the monetary base in the US, are responsible for positive changes in the world equity markets that may last up to six months. Examining impulse responses of equity indices from a Markov Switching VAR, which takes regime changes into account, confirm these findings. Furthermore, we show that equity responses to the positive shocks to the monetary base may be much higher than those to negative shocks. We conclude the US monetary base, and quantitative easing may have contributed to a positive business and credit climate in advanced economies of the world.

This paper investigates the relationship between equity and mortgage real estate investment trust (REIT) returns and inflation. The objective is to establish whether securitized real estate investments provide a reliable inflation hedge. Regression results show that real REIT returns are negatively correlated with the unexpected component of inflation. Therefore, equity and mortgage REIT investments may not offer a safe haven during inflationary periods. Chow tests confirm that there is evidence of a decoupling of REITs from the general stock market for more recent intervals. Fama's proxy hypothesis is also tested: the negative relationship between REITs and inflation is symptomatic of a positive relationship between REITs and real economic activity. However, no support is found for this hypothesis.

This paper investigates the uncovered interest parity theory for the three emerging markets of Korea, the Philippines, and Thailand. The study provides evidence on the efficiency of the currency markets of these economies. In this paper we test for the uncovered interest parity because futures markets for currencies of most emerging markets are not well developed. Furthermore, short- term exchange rate supply and demand are often dominated by the uncovered international investments. Several statistical tests are applied in an attempt to detect evidence of uncovered interest parity. We find there is evidence that the currencies of higher interest rate emerging economies tend to depreciate in the future spot market. However, our test results indicate that this relationship does not support the uncovered interest parity strictly. Arbitrage opportunities remain for a longer periods than predicted by the uncovered interest parity. Furthermore, these abnormal gains are not random and coul...

The recent depreciation of the dollar against major currencies of the world, notably the euro, has kindled discussion on the causes of this phenomenon and the possible outcomes should it continue. Many politicians blame the rising U.S. current account deficit and some economists have questioned the sustainability of the current account deficit. This paper examines the relationship between the U.S. current account balance, the net U.S. international investment position, and the exchange value of the dollar. Our results show that there is a relationship between the exchange value of the dollar and the current account balance. However, our results do not show that the current account balance is solely responsible for changes in the exchange value of the dollar. This is not surprising given the many influences currently under investigation as possible explanations for the recent behavior of the dollar.

Research in economics and finance has documented a negative relationship between stock returns and inflation rates in most economies. The purpose of this study is to investigate this relationship for a particular specific sector investment, air transportation. A significant negative relationship is shown between the air equity index returns and unexpected inflation. Air equity returns, however, are found not be correlated with expected inflation. The Johansen and Juselius cointegration tests verify a long-run equilibrium between air transport equity index, general price levels, and the real economic activity. The short-run dynamics derived from the error-correction model, however, do not support air transport equity index's long-run inflation hedging ability. These findings indicate that investing in air transport equity index may not be a reliable hedge against inflation in the long-or short-run. In addition, the findings do not lend support for the Fisherian and Proxy hypotheses.

This paper investigates the Purchasing Power Parity Theory (PPP) in the context of possible nonlinear relationships between prices and exchange rates of three key currencies. The main contribution of this paper is testing for nonlinearities and nonlinear relationships in a framework of information arrival. Three issues motivated the paper. First, research interest in exchange rate fluctuations, PPP, and exchange rate pass through. Second, market volatilities have triggered curiosity in nonlineraities in various economic and financial time series and nonlinear relationships and chaos in financial markets. For instance, the study of chaotic behavior may shed some light on the nature of latent nonlinearities. Third, developments in the econometrics of nonlinearity in the last three decades offer researchers new tools for detecting relationships that are inherently nonlinear and may not be conducive to various methodologies that are seeking to impose linear modeling on nonlinear relationships. Our findings show strong evidence that the exchange series exhibit nonlinear dependencies that may be inconsistent with chaotic structure. We identify GARCH(1,1) process as the model that best explains the nonlinearities in the monthly exchange rates and inflation rates. Therefore, we propose and estimate bivariate GARCH(1,1) models of the variances to ascertain the flow of information between exchange rates and prices. Bivariate GARCH models show that, the volatility spillover and information arrival between exchange rates and price levels occur simultaneously. Thus, we find support for the PPP theory and exchange rate pass through in the economies under consideration. We conclude that two theories, i.e., the exchange rate pass through and PPP may simultaneously hold the key to exchange rate analysis.

Research in economics and finance documents a puzzling negative relationship between stock returns and inflation rates in markets of industrialized economies. The present study investigates this relationship for Korea and Mexico. We show that the negative relationship between the real stock returns and unexpected inflation persists after purging inflation of the effects of the real economic activity. Johansen and Juselius cointegration tests verify that the long-run equilibrium between stock prices and general price levels is weak. However, in both economies, stock prices and general price levels seem to show a strong long-run equilibrium with the real economic activity. (JEL E31, G I2)

Using a standard event study methodology and the EGARCH model, this study examined the depth of market anomaly at the onset of the Russia–Ukraine conflict in 2022. Equity markets in Africa and G7 nations were analyzed for their varied political and economic connections to the conflict. While the G7 nations were strongly opposed to Russia, African countries remained neutral. This study shows that abnormal losses in the initial period of the conflict were larger and more persistent in the G7 markets, contradicting the widely held notion that more developed equity markets are more efficient than the less developed markets. EGARCH results revealed that volatility persistence was widely present, although the leverage effect was only confirmed for U.S. and Canada. Throughout the period, commodity prices rose sharply, producing significant abnormal gains in the futures market. Unfortunately, this had a deleterious effect on African economies due to their heavy reliance on grain and fuel im...

The international remittance is one of the important sources of foreign exchange earning in the country. Recently, Pakistan received over $4 billion as foreign remittances in 2006. The flows of funds through foreign remittances serve as a cushion balance of payment and foreign reserves. The paper investigated the determinants of international workers' remittances in Pakistan. The time series data was used to identify determinants of the international remittances in Pakistan. The stationary properties of each time series were investigated and each were found to be integrated of order one. Therefore, Cointegration and vector error correction models were used to establish the long run and short run relationship among the included variables in the research. The real remittances in Pakistan were found positively related with real GDP, real growth rate and unemployment rate and were negatively related with real wage rate, literacy rate and spread rate of banks in Pakistan. Based on re...

This paper investigates the leverage effect of local realised exchange rate volatility and implied volatilities in energy market on exchange rate returns in BRICS for the period May 7, 2012 to March 31, 2022, using the quantile regression technique. This paper reveals that oil implied volatility shocks (OVX changes) have a significant negative impact on Russian-U.S. Dollar exchange rate returns in all quantiles. When it comes to the Indian rupee and Chinese RMB returns/Dollar, the adverse effects of OVX are most apparent in both normal and booming market conditions. Although South Africa's currency rate returns are affected by both slump- and bust-market situations, Brazil also tends to be in higher quantiles. The implied volatility indices in the energy market have a substantial and considerable negative impact on the BRICS currencies, with the exception of China, where the effect is only noticeable in the upper extreme quantiles. The policy implications and suggestions are dis...

This paper looks at bound test approach for cointegration analysis, to verify the stability of Singaporean real Gross Domestic Product (GDP), to construct the Monetary Conditions Index (MCI) over the quarterly period 1981:1-2004:4. The bounds test confirms a long-run equilibrium relationship between the output and its determinants, namely short-term and long-term interest rate, exchange rate, claims on private sector, and share prices. Results reveal evidence of cointegration between these variables in both short and long run. As such, this has further verified the stability of the Singaporean output demand function to construct the Monetary Conditions Index (MCI), and how the Monetary Authority of Singapore (MAS) responds to exchange rate changes and whether the policy responses differ. The study has evidently showed that the actual monetary stance reacts corresponding to the MCIs.

All rights reserved. Photocopies for personal use of the reader, not exceeding 15% of each volume, may be made under the payment of a copying fee to the SIAE, in accordance with the provisions of the law n. 633 of 22 april 1941 (art. 68, par. 4 and 5). Reproductions which are not intended for personal use may be only made with the written permission of CLEARedi, Centro Licenze e Autorizzazioni per le Riproduzioni Editoriali,

All rights reserved. Photocopies for personal use of the reader, not exceeding 15% of each volume, may be made under the payment of a copying fee to the SIAE, in accordance with the provisions of the law n. 633 of 22 april 1941 (art. 68, par. 4 and 5). Reproductions which are not intended for personal use may be only made with the written permission of CLEARedi, Centro Licenze e Autorizzazioni per le Riproduzioni Editoriali,

A novel method for identification and extraction of multi-word features, defined as attribute-value pairs, from official press releases. For the specific purpose, we use linguistic and statistical criteria in conjunction with financial domain knowledge.

This study aims to analyze the effect of the Central Bank, which is in Indonesia presented by Bank Indonesia (BI) Rate and inflation rate on the savings rate at commercial banks in Central Sulawesi by using the analysis tools of autoregressive conditional heteroscedasticity (ARCH) and generalized autoregressive conditional heteroscedasticity (GARCH). The results of the analysis show that the BI Rate and inflation have significant effects on saving rate at commercial banks in Central Sulawesi. The importance of being a source of investment funds to support development activities can be a consideration for the government to formulate a policy for allocating investment from these savings funds for productive sectors. Practically, it is hoped that the distribution of savings through investment activities can encourage economic growth and increase economic development in Central Sulawesi.

Globalization has led to a growing increase in financial institutions, as well as to the diversification of their services, due to the international circulation of capital. In view of this increase, the Angolan market has become progressively more competitive, making efficiency a major factor in its survival in the market. This study aimed to analyse the determinants of efficiency in the Angolan banking sector by examining the period from 2014 to 2019. To achieve this objective, we first applied the non-parametric data envelopment analysis methodology to estimate the efficiency levels of banks, and in the second phase, we used a multiple linear regression to obtain an explanatory model of Angolan banking efficiency. In the first stage, the classic Banker, Charnes and Cooper model was used with input orientation, employing the variables of staff expenses and deposits as the inputs, and the total credit as the output, ranking the banks descending order of their efficiency scores. In the second stage, through multiple linear regression, efficiency was expressed as a function of variables measuring the capital adequacy, asset quality, management quality, profitability and liquidity of the banks under study. The variables that proved to be statistically significant in the efficiency of Angolan banking were the solvency ratio, the relationship between liabilities and equity and return on equity.

The direction of flow is not certain in which variations in the exchange rate could be transmitted to the consumer price index. To examine the transmission mechanism arising from the exchange rate to consumer price index in the Nigerian economy, eight variables-VAR model was employed in this regard. The data for the study span from the period first quarter of 2009 to the fourth quarter of 2021. The results had it that exchange rate devaluation is transmitted directly to consumer price index through a rise in the net exports and also the aggregate demand. The study therefore, recommends a rise in terms of outputs in local production so that the weight of the inflationary impact of the exchange rate devaluation could be minimal.

We would like to thank Lehman Brothers in general and Tom Grant and Giovanni Pillitteri in particular for their help on acquiring data. We also thank Reuters and EBS for permission to use this data. The comments of Kathryn Dominguez and Philipp Hartmann were most helpful. This research was undertaken whilst Francis Breedon was a research visitor at the ECB. Any errors remain our responsibility.

At the beginning of next year, euro notes and coins will be finally introduced into the euro area. Although this is likely to be a major upheaval for the euro-area economy, it does not have any obvious implications for the exchange rate. However, research on exchange rate determination suggests an unexpected and powerful exchange rate impact of changes in currency demand.

The views expressed are those of the authors and do not necessarily reflect those of the Bank of England. This paper was prepared for the autumn 1995 BIS meeting of Central Bank Economists. We would like to thank Creon Butler, Spencer Dale, Jim Steeley, Allison Holland and Colin Rawlings fo r helpful advice and Kevin Barry fo r research assistance. Issued by the Bank of England, London, EC2R 8AH to which requests fo r individual copies should be addressed: envelopes should be marked fo r the attention of the Publications Group (Telephone: 0171 601 4030).

After outlining some of the monetary developments associated with Quantitative Easing (QE), we measure the impact of the UK's initial 2009-10 QE Programme on bonds and other assets. First, we use a macro-finance yield curve both to create a counterfactual path for bond yields and to estimate the impact of QE directly. Second, we analyse the impact of individual QE operations on a range of asset prices. We find that QE significantly lowered government bond yields through the portfolio balance channel -by around 50 or so basis points. We also uncover significant effects of individual operations but limited pass through to other assets.

We look at the exchange rate policy choices and outcomes for small rich economies. Small rich economies face significant policy challenges due to proportionately greater economic volatility than larger economies. These economies usually choose some form of fixed exchange rate regime, particularly in the very small economies where the per capita cost of independent monetary policy is relatively high. When such countries do choose a free or managed floating regime, they appear to derive no benefit from those regimes; their exchange rate volatility seems to rise without any significant change in fundamental economic volatility. Thus, for these countries, floating exchange rates seem to create problems for policy makers without solving any.

Using a comprehensive high‐frequency foreign exchange data set, we present evidence of time‐of‐day effects in foreign exchange returns through a significant tendency for currencies to depreciate during local trading hours. We confirm this pattern across a range of currencies and time zones. We also find that this pattern is reflected in order flow and suggest that both patterns relate to the tendency of market participants to be net purchasers of foreign exchange in their own trading hours. Data from a single market maker appears to corroborate that interpretation.

Located in the eastern part of northern Italy, Verona is one of the best excavated Roman towns in this territory, and the funerary dimension of the ancient and medieval period is one of the best known. This paper systematically examines the ritual use of coins in late antique and early medieval burials documented in the city and its hinterland and links this situation to those observed in other contemporary cases in northern Italy. The analysis focuses on the position of the coinage in the tomb, the sex and age of those buried, and the types of coins used. For this purpose, forty-three burials from between the third and seventh centuries were selected, yielding a total of eighty-four coins minted between the first and fifth centuries. The cases are documented in excavations carried out with the stratigraphic method in the city and its hinterland in recent decades, although some chance finds (unexcavated) were considered due to the quality of the data. By illuminating the ritual use of coins in the Veneto during this barely studied period, this study provides a reference for the analysis of contemporary cases in other areas.

Este trabajo muestra cómo han quedado adulteradas dos de las funciones de la moneda: medida del valor y del medio de liberación de deudas. La moneda ya no puede tener como referente visible el trabajo ni remitir tampoco al intercambio, con lo que éste supone deuda y obligaciones recíprocas. La medida del dinero puede perderse y la representación del valor está alterada o no existe: suele depender de un estatus dado por la capacidad de adquisición. Este cambio -que pasa también por la representación de la confianza en y el poder del dinero-consiste en desconocer la deuda que encierra la moneda como relación y en privilegiar en exclusiva la realización del beneficio. Este fenómeno se origina tiempo atrás en la subordinación de la gran divisa internacional a intereses particulares, aunque hoy parezcan ser la voluntad general.

This research revisits the effects of a country's institutional framework on individual firms' behavior, in particular focusing on their propensity to comply with legal rules in transition economies. The authors purport to explain the variation in compliance with legal rules ...

This is a Working Paper and the author(s) would welcome any comments on the present text. Citations should refer to a Working Paper of the International Monetary Fund. The views expressed are those of the author(s) and do not necessarily represent those ofthe Fund.

We analyze optimal income taxes and optimal schooling subsidies in a dynamic private information economy with observable human capital accumulation. We show that the marginal schooling subsidies are, under plausible conditions, positive and that they are zero at both endpoints of the skill distribution. For our utility specification, we suggest that the optimum can be implemented in a competitive equilibrium with a tax system where taxes each period depend only on current income and current schooling. We calibrate the model to the U.S. economy in order to quantify the optimal policies and evaluate their impact in the transition and in the steady state. We find that the optimal schooling policies are significantly smaller than the optimal marginal income taxes. If their are introduced jointly with optimal income taxes their welfare and * We would like to thank the participants of the Carnegie-Rochester conference in April 2007 and especially Borys Grochulski for helpful comments. This research has originated during out stay at the Univeristy of Tokyo. We would like to thank Toni Braun for his hospitality during our stay.

This paper explores the causes, types and costs of inflation with the concept of inflation. Given the overall economy's complexity as the world biggest transition economy, the inflation pattern presents recurrent episodes of cyclical inflation surge and decline. This paper then examined the inflation determinants. With the review of literature and previous concept this paper identifies the effects of inflation and show the measuring system of inflation. CPI or consumer price index system is widely used measurement procedure of inflation. but with the change of life style and necessity of people only CPI cannot represent the actual rate of inflation in the current decade. This paper examined the basket of CPI and also shows some overall inflationary chart of current decade. with the change of standard of living the necessity and the choice of goods and services of the consumers changes. so now a days CPI cannot perfectly represents the inflationary situation. To find out the appropriate measurement process further research is necessary. This paper concludes with some suggestions regarding anti inflationary policies.