This research investigates the differences in awareness and preference of racial groups toward the types of energy that they would like to see incorporated into the future energy system. Based on a national survey of 3000 respondents conducted in 2020, we analyze the differences in awareness, preferences and attitudes among racial groups in the US, and how they will influence future energy system design

This paper uses a new measure of international trade, i.e. the international trade potential index, to measure the welfare gains from trade across countries. The measure is based on the import shares of countries in their gross domestic products. It is observed that gains from international trade are low in prosperous economies, but they are larger in poorer economies. Then, the paper investigates

The financialization of the energy market has capacitated energy commodities to affect economic activities unfathomably. Despite the availability of rich literature investigating crude oil and developing its strong ties with economic and financial stability and climate change, little attention has been paid to natural gas (NG or LNG) and its potential to affect economies. Natural gas is not merely

Abstract not available

According to Frankel and Catao (2011), a commodity-exporting developing economy is advised to target the product price rather than consumer price, as the former monetary policy is automatically countercyclical against the volatile terms of trade shock. This paper constructs a dynamic stochastic general equilibrium model of joint monetary and fiscal policies for a developing oil economy, to find an

Understanding mixed results for the impact of income on household solar-panel uptake is important for several reasons. Income is often a central feature of economic studies or a key control for social studies. Furthermore, policy makers are increasingly relying on income to determine solar-subsidy eligibility. We use a large sample of Australian households to suggest reasons for mixed results. For

We empirically examine the effects of index investing using predictions derived from a Grossman-Stiglitz framework. An exogenous increase in index investing leads to lower information production as measured by Google searches, EDGAR views, and analyst reports, yet price informativeness remains unchanged. These findings are consistent with an equilibrium in which investors choose to gather private information

This study establishes a novel empirical framework using machine learning techniques to measure the urban-regional disparity of the public’s mental health signals in Australia during the pandemic, and to examine the interrelationships amongst mental health, demographic and socioeconomic profiles of neighbourhoods, health risks and healthcare access. Our results show that the public’s mental health

I present closed-form solutions for prices, portfolios, and beliefs in a model where four types of investors trade assets over time: naive investors who learn via a social network, “fanatics” possibly spreading fake news, and rational short- and long-term investors. I show that fanatic and rational views dominate over time, and their relative importance depends on their following by influencers. Securities

We introduce a profitable trading strategy that can support decision-making in continuous intraday markets for electricity. It utilizes a novel forecasting framework, which generates prediction bands from a pool of path forecasts or approximates them using probabilistic price forecasts. The prediction bands then define a time-dependent price level that, when exceeded, indicates a good trading opportunity

Sentiment should exhibit its strongest effects on asset prices at times when valuations are most subjective. Accordingly, we show that a one-standard-deviation increase in aggregate uncertainty amplifies the predictive ability of sentiment for market returns by two to four times relative to when uncertainty is at its mean. For the cross-section of returns, the predictive ability of sentiment for assets

Since the onset of COVID-19, scholars have questioned whether the pandemic will alter the fundamentals propelling the growth of global cities. Using a case study of Toronto, the paper examines and analyses changes impacting the city because of the pandemic, with a focus on work, mobility and housing. In assessing pandemic-related disruption, it outlines the experiences of the early phases of recovery

The purpose of this article is to investigate whether various uncertainty measures provide incremental information for the prediction the volatility of crude oil futures under high-frequency heterogeneous autoregressive (HAR) model specifications. Moreover, by considering the information overlap among various uncertainty measures and fully using of the information in various uncertainty measures, this

Abstract The assessment of entrepreneurship education outcomes should move beyond a focus on firm creation and associated economic impact to consider a more nuanced view that pays attention to graduates and their entrepreneurial competencies. There is currently limited understanding to what extent entrepreneurial competencies developed through entrepreneurship education are applied in graduates’ subsequent

Journal of Political Economy, Volume 130, Issue 7, July 2022.

Journal of Political Economy, Volume 130, Issue 7, July 2022.

Journal of Political Economy, Volume 130, Issue 7, Page 1991-1991, July 2022.

Journal of Political Economy, Volume 130, Issue 7, July 2022.

In this study, we analyse the implications of clean energy, oil and emission prices for the energy sector stock in the GCC region. In so doing, we estimate one-day-ahead value at risk (VaR) and the expected shortfall (ES) for Saudi, Abu Dhabi and Kuwaiti energy stock prices over short and long trading positions using three different long memory Autoregressive conditional heteroskedasticity (ARCH)/

This paper elucidates, whether airfares respond asymmetrically to fuel price changes. Recent literature suggests conflicting evidence on whether airfares respond rapidly to the increase in fuel price than to the decrease. Using monthly U.S. data spreading over January 2000 to June 2019 and by employing a multiple threshold nonlinear autoregressive distributed lag model, this paper doesn't surface any

Abstract not available

The COVID-19 pandemic has brought about enormous disruption in mobility in cities. We review and analyse the evidence generated since the advent of the crisis, paying special attention to travel behaviour changes and how they are hampering the achievement of sustainability goals. Modal shifts to more individual modes of transport, with regained interest in car usage, combined with the financial distress

A principal (e.g., the US government) contracts with a researcher with unknown costs (e.g., a vaccine developer) to conduct a costly experiment. This contracting problem has a novel feature that captures the difference between the form of an experiment and the strength of its results: researchers face a problem of information design rather than optimal effort. Using a novel comparative static for Bayesian

Abstract not available

Macroeconomists increasingly use external sources of exogenous variation for causal inference. However, unless such external instruments (proxies) capture the underlying shock without measurement error, existing methods are silent on the importance of that shock for macroeconomic fluctuations. We show that, in a general moving-average model with external instruments, variance decompositions for the

The long-term and sustainable development focuses of green bond together with its increasing popularity drives the need for a better understanding of its hedging effects against market risks. Our study investigates whether and how green bond can act as a hedging instrument against implied volatility, a measure of forward-looking market uncertainty. We find evidence of significant time-varying connectedness

We use option prices and realized returns to decompose risk premia into different parts of the return state space. In the data, 8/10 of the average equity premium is attributable to monthly returns below −10%, but returns below −30% matter very little. In contrast, prominent asset pricing models based on habits, long-run risks, rare disasters, undiversifiable idiosyncratic risk, and constrained intermediaries

Feeding America allocates donated food to over 200 food banks. In 2005, it transitioned from a queueing mechanism to one where food banks use a specialized currency to bid for food. Food banks chose very different food than they received before. Small food banks acquired 72% more pounds per client than large food banks at little nutritional cost. This reallocation of food is estimated to have increased

This study examines the conditional capital surplus and shortfall dynamics of renewable and non-renewable resource firms. To this end, this study uses the systemic risk index by Brownlees and Engle (2017) and considers two conditional systemic events, namely, a stock market crash and a commodity price crash. The results indicate that generally, companies in the resource sector tend to have conditional

Renewable energy finance may incur an economic or fiscal shock due to uncertainty and destruction from armed conflicts. Using cross-country panel data over the period 1996–2018, this research therefore examines the impact of armed conflicts on renewable energy finance based on linear and non-linear regression techniques. From the linear dynamic panel model we find that armed conflicts exhibit a negative

We examine the decision problem of a power producer contemplating an upgrade of its current generation capacity based on a fossil fuel technology (gas plant), when price processes have affine drift and differentiable volatility functions. The operator can choose the best of four mutually exclusive alternatives, continue operating the current technology, replace it by a more efficient fossil fuel technology

The transition to low-carbon economies requires massive investments into renewable energies, which are commonly supported through regulatory frameworks. Yet, governments can have incentives – and the ability – to deviate from previously announced support policies once those investments have been made, which can deter investments. We analyze a renewable energy dynamic regulation game and derive under

Risk neutral valuation determines no arbitrage values for financial or real assets, including ones that are exposed to energy price risk. It is always uniquely associated with a hedging strategy if and only if markets are complete, which is the exception in theory and never the case in practice. We apply quadratic hedging, which is both conceptually simple and partially analytically tractable, in a

Using novel credit data, we show that hedge fund borrowing is significantly overcollateralized, primarily with rehypothecable securities. An idiosyncratic liquidity shock to a major prime broker significantly decreases credit to connected hedge funds. The dominant channel behind this shock transmission is credit supply reduction rather than precautionary demand reduction. Funds posting more rehypothecable

Using bid-level data from discriminatory auctions for Mexican government bonds, we demonstrate that asymmetric information about default risk is a key friction in sovereign bond markets. We document that large bidders achieve higher bid-acceptance rates than other bidders despite paying no more for executed bids. We then propose a new model of primary markets in which investors may differ in wealth

The literature on optimal dispatch of wholesale power systems implicitly assumes that market participants are risk-neutral. But, in practice, most wholesale electricity market participants behave as though they are risk averse, seeking to insulate themselves from the market risks they face. In this context, achieving the overall social-welfare maximum requires simultaneously finding both the optimal

After the inclusion of Green energy financing in the list of United Nations Sustainability Goals (SDGs) as SDG 7, the role, importance, and visibility of green financial products have escalated enormously. This paper assesses the utility of green exchange-traded funds (ETFs), in the investors' portfolios for their dual potential of sustainability and diversification. ETFs provide a unique opportunity

This paper studies the impact of oil price shocks on fiscal policy and real GDP in Oman using new unexplored data. We find that an oil price shock explains around 22% and 46% of the government revenue and GDP variation, respectively. Decomposing the government revenue and GDP further into petroleum and non-petroleum related components, we find that an oil price shock explains around 26% of the variation

In this paper we propose a mechanism for the allocation of pipeline capacities, assuming that the participants bidding for capacities do have subjective evaluation of various network routes. The proposed mechanism is based on the concept of bidding for route-quantity pairs. Each participant defines a limited number of routes and places multiple bids, corresponding to various quantities, on each of

This paper contributes to the existing literature by investigating the impacts of crude oil price shocks on financial markets through an examination of the effect of oil price shocks on the issuance of corporate green bonds. Green bond issuance has been growing fast over the past several years; despite this, the share of green bonds in the total bonds remains less than 1%. Using the Tobit model, multilevel

This paper analyzes firms' incentives to engage in environmental corporate social responsibility (ECSR) in an international market under imperfect competition. We find that in the absence of environmental taxes firms do not adopt ECSR. However, the implementation of environmental taxes by governments encourages firms to adopt ECSR under local damage. Consumers, producers, and environmentalists are

Using detailed loan holding data of Collateralized Loan Obligations (CLOs), we document empirical evidence for the fire sale of leveraged loans due to leverage constraints on CLOs. Constrained CLOs are forced to sell loans downgraded to CCC or below, and thus loans widely held by constrained CLOs experience temporary price depreciation. This instability is exacerbated by diversification requirements

The analysis of causality among oil prices and, in general, between financial and economic variables is of central relevance in applied economic studies. The recent contribution of Lu et al. (2014) proposes a new causality test, the DCC-MGARCH Hong test. We show that the critical values of the test statistic should be evaluated through simulations to avoid potential Type I errors. We also note that

There is growing interest in the causes of energy poverty. This study examines the relationship between Protestantism and energy poverty. Employing household panel data for Australia, our preferred estimates, which account for endogeneity of Protestantism, suggest that being Protestant is associated with a 1.7 percentage point decrease in the probability that a respondent is in energy poverty based

We develop a new methodology to estimate the impact of a financial transaction tax (FTT) on financial market outcomes. In our sequential trading model, there are price-elastic noise and informed traders. We estimate the model through maximum likelihood for a sample of 60 NYSE stocks in 2017. We quantify the effect of introducing an FTT given the parameter estimates. An FTT increases the proportion

Abstract not available

Journal of Political Economy, Ahead of Print.

Volatility spillovers are a characteristic of interconnected electricity markets. We use high-frequency prices to analyze the transmission of volatility across five Australian regional electricity markets. We propose several models: The first includes only realized variances; the second adds realized covariances; the last two include positive and negative realized semi(co)variances, separately, obtained

We study governance when shareholders vote and can also buy or sell shares. We find that voting for the policy that one believes is better for the firm maximizes portfolio value only when pivotal; otherwise, it is better to vote against one’s information, distort the market, and then trade at the distorted price. Equilibrium voting informativeness balances these forces and is demonstrably low. As the

This paper endogenizes intervention in financial crises as the strategic negotiation between a regulator and creditors of distressed banks. Incentives for banks to contribute to a voluntary bail-in arise from their exposure to financial contagion. In equilibrium, a bail-in is possible only if the regulator’s threat to not bail out insolvent banks is credible. Contrary to models without intervention

Journal of Political Economy, Volume 130, Issue 6, June 2022.

Journal of Political Economy, Volume 130, Issue 6, June 2022.

Journal of Political Economy, Volume 130, Issue 6, Page 1716-1716, June 2022.

Journal of Political Economy, Volume 130, Issue 6, June 2022.