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Publication Cost per unit abated for selected nitrogen mitigation strategies on Irish farms(NUI Galway, 2018) Chyzheuskaya, Aksana; O'Donoghue, Cathal; Ryan, Mary; O'Neill, Stephen; Department of Agriculture, Food and the MarineWith the initial deadline identified by the Water Framework Directive (Directive 2000/60/EC) has passed in 2015 and new one set out in 2027, policymakers face increasing pressure to introduce new regulations to achieve water quality targets. Agriculture is one of the contributors of diffuse pollution entering watercourses and hence will come under pressure to further reduce pollutant loads. This paper describes a microsimulation model that allows the Cost per Unit Abated (CPUA) for six farm-level measures that could potentially reduce nitrate loss to water bodies from agricultural land on Irish dairy farms to be estimated. Results from this study indicate that almost all of the considered measures will lead to reductions in farm gross margins. However, some of these measures can be still implemented at acceptable cost-effectiveness ratios. Furthermore we observe variation in the ranking of the measures by CPUA across farms suggesting that a one-size-fits-all command-control approach may place unnecessary costs on some farms, where alternative policies may lead to N reduction at lower costs. Hence, focusing on the average CPUA across all farms, overlooks the heterogeneity of impacts across individual farms, potentially leading to sub-optimal policies being implemented.Publication A comparative examination of healthcare use related to hearing impairment in Europe(2016) O'Neill, Ciaran; Xiao, Mimi; |~|Impaired health resulting from whatever source presents challenges to individuals and societies. These challenges can be presented in terms of an economic burden - costs and dis-utilities - that arise from the experience of and efforts to manage or resolve the health issue. Examining this burden can help us understand the magnitude and distribution of the burden within society, how it might impact different agents and what impact particular resource allocation decisions might have on these. An examination of the burden associated with impaired health can throw into sharp relief the interconnectedness of different budgets, for example, and how attempts to effect savings in one area can have unintended and potentially greater consequences in others.Publication Using a farm micro-simulation model to evaluate the impact of the nitrogen reduction mitigation strategies(2015) Chyzheuskaya, Aksana; |~|Publication The Determinants of Residential Gas Demand in Ireland(Department of Economics, National University of Ireland, Galway, 2014) Harold, Jason; Lyons, Seán; Cullinan, John; |~|This paper examines the determinants of residential gas demand in Ireland using a microeconometric analysis of the daily gas consumption panel data from Ireland's Smart Metering Gas Consumer Behavioural Trial. It also investigates the e ectiveness of the demand side management stimuli that were tested during the Smart Metering Trial. The analysis is based on a sample of 1,181 households over 539 days. The results provide evidence that weather, together with the structural characteristics of the dwellings and the socio-economic characteristics of the households, are signi cant factors in explaining residential gas demand. More speci cally, weather is found to be the most in uential factor on household's daily gas consumption. Finally, the demand side management stimuli employed in the Smart Metering Trial were found to reduce daily household gas use on average.Publication Quantifying the effects of the inclusion and segregation of Contracts for Difference in Australian equity markets(2013) Corbet, Shaen; Twomey, Cian; |~|This study examines the effects that Contracts for Difference (CFDs) have had on theAustralian equity market, either as an accelerant for mispricing, or as a source of increased marketfunctionality through the addition of a new tradable product and increased liquidity. The AustralianSecurities Exchange (ASX) made the decision to segregate CFDs to a separate ring-fenced exchangein November 2007. This study uses EGARCH techniques to test for the effects of CFDs on returnvolatility at the time of CFD inclusion and segregation in Australian equity markets at the index andequity-specific level. A fully worked explanation and example of a CFD-influenced overhang is alsoprovided. The results provide evidence that cannot reject the presence of overhangs in Australianequity markets.Publication How have Contracts for Difference affected Irish equity market volatility?(2013) Corbet, Shaen; Twomey, Cian; |~|Contracts for Difference (CFDs) have existed for less than twenty years and the market has grown significantly up to the period before the recent international crises. This paper presents an analysis of how CFDs have affected equity market volatility in Ireland. EGARCH models are used to uncover volatility changes in the periods before and after the introduction of the new trading product in Ireland. We find that CFDs appear to have lowered asset-specific volatility across the majority of equities traded on the Irish Stock Exchange. These findings do not correspond to the expected volatility increase associated with leveraged products that are closely associated with high frequency trading. Our empirical analysis suggests that CFDs are having an alternative volatility reducing effect through the presence of bid and ask price overhangs that are generated through the hedging practices of CFD brokers. A fully worked example of the development of an overhang is provided.Publication Assessing the Empirical Performance of the DSGE models in the lead up to the Crisis(2013) Ashe, Sinead; Raghavendra, Srinivas; |~|PRTLI|~|The global financial crisis has sparked renewed debate over the state of macroeconomic modeling, particularly in the lead up to the 2008/2009 Great Recession. The standard workhorse of macroeconomic modeling, the Dynamic Stochastic General Equilibrium (DSGE) model, has been subject to intensive scrutiny. Over the past decade, there has been significant increase in the use of DSGE models by central banks for policy analysis, forecasting and prescriptions. The majority of central banks from developed countries have established DSGE models, including the Federal Reserve Bank, the European Central Bank, the IMF and the Bank of England. Given their prevalence among central banks coupled with their use by policy makers for analysis and forecasting, the objective of this research paper is to assess the behavior and forecasts made by these DSGE models in the run up to a financial crisis. A DSGE model is estimated for the United States for the pre-crisis period Q1.1947 to Q4.2007. An empirical verification of the data is undertaken, whereby forecasts made by the DSGE models are compared with the observed post-crisis data. We find that the DSGE model does a poor job of forecasting the Great Recession, and gives no indication that a downturn is imminent in the economy. Within the current paradigm, there is no role for financial frictions. As such, we suggest that the building blocks of DSGE models are too simplistic to effectively model key dynamics within the economy. We use the role of debt accumulation by US households as a means of illustrating this. The global financial crisis has sparked renewed debate over the state of macroeconomic modeling, particularly in the lead up to the 2008/2009 Great Recession. The standard workhorse of macroeconomic modeling, the Dynamic Stochastic General Equilibrium (DSGE) model, has been subject to intensive scrutiny. Over the past decade, there has been significant increase in the use of DSGE models by central banks for policy analysis, forecasting and prescriptions. The majority of central banks from developed countries have established DSGE models, including the Federal Reserve Bank, the European Central Bank, the IMF and the Bank of England. Given their prevalence among central banks coupled with their use by policy makers for analysis and forecasting, the objective of this research paper is to assess the behavior and forecasts made by these DSGE models in the run up to a financial crisis. A DSGE model is estimated for the United States for the pre-crisis period Q1.1947 to Q4.2007. An empirical verification of the data is undertaken, whereby forecasts made by the DSGE models are compared with the observed post-crisis data. We find that the DSGE model does a poor job of forecasting the Great Recession, and gives no indication that a downturn is imminent in the economy. Within the current paradigm, there is no role for financial frictions. As such, we suggest that the building blocks of DSGE models are too simplistic to effectively model key dynamics within the economy. We use the role of debt accumulation by US households as a means of illustrating this.Publication Critical transitions in Eurozone sovereign bond markets(Department of Economics, National University of Ireland, Galway, 2013) Metadjer, Naoise; Raghavendra, Srinivas; |~|IRCHSS|~|In this paper we present empirical evidence that the sovereign bond markets may have undergone a catastrophic transition during the Eurozone debt crisis. We find evidence of a phenomenon called critical slowing down that theory predicts should precede such transitions. Two alternate approaches are used to detect critical slowing down. Firstly we estimate the domain of attraction, a methodology that has been used to detect critical transitions in ecological systems, which examines the rate at which a system returns to equilibrium following a stochastic shock. Secondly, we examine the statistical properties of sovereign bond yield data for trends which have been shown to precede catastrophic regime shifts between alternate steady states in many real world dynamical systems. Our results indicate that critical transitions approach provides an alternative method to study financial market crashes and the phenomenon of critical slowing down estimated from the statistical properties of the financial data may act asa useful early warning signal in predicting the crashes.Publication An investigation into the dynamics of financial catastrophe(Economics Working Paper, 2012) Raghavendra, Srinivas; |~|The paper captures the dynamics of interaction between the real and the nancial sector in a model of endogenous credit that exhibits multiple steady states and generates phase transitions with catastrophic abrupt- ness. This resembles aspects of nancial meltdowns witnessed in global capital markets in recent times. The paper also explains how nan- cial crisis assume dierent characteristics under alternative monetary arrangements in regimes of prot- and wage-led growth and, concludes with linking the analysis to the recent nancial crises in the United States and in the Eurozone.Publication Exploring inequalities in service use: the case of cervical cancer screening in Ireland, the United Kingdom and United States(National University of Ireland, Galway, 2013) Walsh, Brendan; O'Neill, Stephen; O'Neill, Ciaran; Health Research BoardThis study examined inequalities in uptake of cervical cancer screening in the Republic of Ireland, Britain and Northern Ireland, and the United States using data from nationally representative surveys in 2007/2008. Regression analyses and a comparison of concentration indices measuring income related inequalities were used to explore between group differences across all countries. Uptake of cervical cancer screening in the past 12 months is significantly higher in the US (59.90%) than in the UK (28.43%) and Ireland (17.98%). Concentration indices for screening in the past 3 years demonstrated a pro-rich inequality in uptake in England (0.076***) no inequality in Wales (-0.027) and Scotland (-0.013) and increasing pro-poor inequalities amongst Northern Ireland Catholics (-0.155**). Whites had the largest inequalities in the US (0.261***) compared to Blacks (0.092**) and Hispanics (0.115***). Results from the marginal effects showed no inequalities in the UK as a whole, but significant disparities for Ireland and the US across both income and education levels in the US. There are a variety of potential explanations for the observed differences between countries in the pattern of uptake among demographic groups, including divergence in health systems across country and differences in perception of risk. Racial and cultural differences also appear to play a role. That such differences may exist but be masked by estimates of inequality at a national level indicates the importance of a more nuanced approach to the examination of inequality and policy makers should be cognisant of such potential heterogeneity when developing policy instruments to address inequalities. A policy which decreases inequality at a national level may exacerbate existing inequities between groups if such heterogeneity is ignored when formulating policy.Publication A methodological framework for the study of residential location and travel-to-work mode choice under central and suburban employment destination patterns(2009) Vega, Amaya; |~|The aim of this paper is to contribute to the methodological questions that arise from the study of the simultaneous choice of residential location and travel-to-work mode under central and non-central or suburban employment patterns. Geographic information system (GIS) visualisations and network analysis are used to generate a choice set based on the definition of spatially aggregated alternatives. Discrete choice models specified as cross-nested logit (CNL) are estimated for each of the two different types of employment patterns and direct and cross elasticities are presented. The analysis is carried out for the Greater Dublin Area, a metropolitan region that is a recent example of rapid employment suburbanisation and residential sprawl in a European context. A simulation exercise, tracing the extent of mode switching and location switching behaviour is undertaken using the framework developed. (C) 2008 Elsevier Ltd. All rights reserved.Publication Examining the dynamical transition in the Dow Jones Industrial Index from Bull to Bear market using Recurrence Quantification Analysis(2012-11-20) Moloney, Kitty; Raghavendra, Srinivas; J.E. Cairnes School of Business and EconomicsWe present evidence of phase transitions (periodic to chaotic and chaotic to chaotic) in the Dow Jones Industrial Index as it transitions from Bull to Bear market. There is also evidence of a completely unpredictable (i.e., nondeterministic) regime just as the market peaks. The noisy trader theory is suggested as the economic explanation for this unpredictability i.e. rational but uninformed traders chase noise rather than the usual macro economic and financial variables. We suggest that the collapse in determinism allows the dynamics of the market to break from the past and that the market is in fact piecewise deterministic. A principal component series is developed and named the random market indicator, (RMI). This can be used to indicate when the market is transitioning. The RMI indicator could be used by market participants, financial regulators and policy makers as an indicator of market crisis. During times of crises, quantitative risk estimation techniques such as stationary value at risk models, will give misleading results and should not be used.Publication A choice experiment versus a contingent valuation approach to agri-environmental policy valuation(National University of Ireland, Galway, 2011-07) Hynes, Stephen; Campbell, Danny; Howley, Peter; Irish Department of Agriculture, Fisheries and Food - Rural Stimulus FundThe non-market value accruing from an agri-environmental scheme can be examined by assessing the public's willingness to pay for the policy outputs as a whole or by modelling the preferences of society for the component attributes of the rural landscape that result from the implementation of the policy. In this paper we examine if the welfare impacts from implementing an agri-environmental policy are significantly different if one uses a holistic valuation methodology such as contingent valuation or an attribute based valuation methodology such as choice experiments. It is argued that the valuation methodology chosen should be based on whether or not the overall objective is the valuation of the agri-environment policy package in its entirety or the valuation of each of the policy's distinct environmental outputs.Publication The Emerald or Yellow Isle? Estimating the welfare impacts of agricultural landscape change in Ireland(National University of Ireland, Galway, 2011-01) Hynes, StephenIn this paper we exploit a discrete choice modeling framework to estimate the potential non-market welfare impacts of alternative hypothetical rural Irish landscapes that could become real by the year 2030 depending both on future agricultural policy reform and changing land use demands. These hypothetical rural Irish landscapes were developed, based on a study by Flanagan et al. (2007) entitled 2030 Foresight Report for Irish Agriculture where 5 different possible 'Irish farming futures' that may arise in 2030 were described. The results of a Random Parameters Logit model demonstrate significant preference heterogeneity amongst the Irish population for the attributes of agricultural landscapes. The largest welfare gain for the population is found to be from the 'agri-environmental landscape' that protects traditional farm landscape features and enhances biodiversity.Publication A measure of distance between judgment sets (Working paper no. 169)(National University of Ireland, Galway, 2011-02) Duddy, Conal; Piggins, AshleyIn the literature on judgment aggregation, an important open question is how to measure the distance between any two judgment sets. This is relevant for issues of social choice: if two individuals hold different beliefs then we might want to find a compromise that lies somewhere between them. We propose a set of axioms that determine a measure of distance uniquely. This measure differs from the widely used Hamming metric. The difference between Hamming's metric and ours boils down to one axiom. Given judgment sets A and B, this axiom says that if the propositions in A n B jointly imply that the propositions in A - B share the same truth value, then the disagreement between A and B over those propositions in A - B should be counted as a single disagreement. We consider the application of our metric to judgment aggregation, and also use the metric to measure the distance between preference rankings.Publication Aggregating partitions(National University of Ireland, Galway, 2011-02) Duddy, Conal; Piggins, Ashley; Irish Research Council for the Humanities and Social Sciences; Spanish Ministry of Science and Innovation (Feder grant SEJ2007- 67580-C02-02); NUI Galway Millennium FundConsider the following social choice problem. A group of individuals seek to partition a finite set X into two subsets. The individuals may disagree over the partition and an aggregation rule is applied to determine a compromise outcome. We permit collective indifference and so the outcome is a pair of disjoint subsets of X which may or may not partition X. Critically, neither subset can contain all of the elements in X. We present four normatively desirable properties that identify one aggregation rule uniquely. These properties are similar to those Young (J. Econ. Theory 9 (1974) 43-52) used in his characterization of the Borda rule.Publication Do farmers in Agri-Environmental schemes make appropriate ecological choices for the habitats on their farms? Modelling the biodiversity undertakings chosen within the Irish Rural Environment Protection Scheme(National University of Ireland, Galway, 2011-07) Murphy, Geraldine; Hynes, Stephen; Murphy, Eithne; O'Donoghue, Cathal; Green, Stuart; Irish Department of Agriculture, Fisheries and Food - Rural Stimulus FundFarmers participating in agri-environmental schemes (AESs) that are aimed at protecting biodiversity should ideally make decisions relating to the ecological management of their farms based on the habitat types found on their farms. In reality, a variety of economic, demographic, farm and farmer characteristics influence all the management decisions made by farmers, including those relating to AESs. In Ireland, the Rural Environment Protection Scheme (REPS) requires that farmers choose at least 2 biodiversity undertakings (BUs) from a menu as part of their AES contract. Using a multinomial logit model, the likelihood of farmers choosing different BUs was estimated using data from the 2007 National Farm Survey as a function of georeferenced habitat data. A comparison is then made between the probable selection of BUs with what would be considered the optimal selection from an ecological perspective. The results indicate that farmers' most likely choices of BUs only sometimes equates with the optimal ecological choices. This highlights deficiencies in the design of REPS, knowledge of which is very timely, given the imminent replacement of REPS by a new AES.Publication Measuring public preferences for the conservation of the traditional farm landscape(National University of Ireland, Galway, 2011-07) Howley, Peter; Hynes, Stephen; O'Donoghue, CathalThis paper explores individuals' attitudes towards the traditional farm landscape. Results from a Generalised Tobit Interval model of willingness to pay for traditional farm landscape protection suggest that individuals are more willing to pay to support agricultural activities aimed at protecting landscape features associated with the wider biological and cultural diversity of the countryside (such as woodland, bogland, wild flora and fauna, water quality and aspects associated with our cultural heritage) than what could be described as more obvious and scenic landscapes associated with farming activities (such as open grass covered fields, grazing farm animals and well maintained traditional farm buildings). More generally, the results indicate broad public support for second pillar objectives under the Common Agricultural Policy (CAP) such as the protection of the traditional farm landscape.Publication U.S. Presidential Elections and the referendum paradox(National University of Ireland, Galway, 2011-02) Piggins, Ashley; Irish Research Council for the Humanities and Social Sciences; NUI Galway Millennium FundIn the United States, the president is elected by the Electoral College (EC) and not directly by individual voters. This can give rise to a so-called 'referendum paradox' in which one candidate receives more popular votes than any other, but this candidate is not elected. The 2000 election is an example of this phenomenon. Can the EC be reformed so that a referendum paradox never arises? We consider varying three natural parameters. First, we consider changing the method of apportioning seats in the House of Representatives to states. Second, we consider changing the total number of seats in the House. Intuition suggests that as the number of seats approaches the number of voters, the referendum paradox should disappear. Finally, we consider varying the fixed and proportional components of each state's EC vote. Using data from U.S. presidential elections we show that none of these reforms can prevent a referendum paradox from occurring. We conclude that susceptibility to a referendum paradox is an inescapable feature of the system for electing presidents. An interesting corollary of our analysis is that seemingly insignificant changes to the EC can cause different candidates to be elected president.Publication A model of deliberative and aggregative democracy(National University of Ireland, Galway, 2011-02) Perote Pena, Juan; Piggins, Ashley; Irish Research Council for the Humanities and Social Sciences; Spanish Ministry of Science and Innovation (MICINN/FEDER grants ECO2010-21624 and ECO2010-14929); NUI Galway Millennium FundWe present a model of collective decision making in which voting and deliberation are treated simultaneously. Political theorists argue that public discussion can lead individuals to change their preferences. This aspect of democracy is typically ignored in models of social choice that focus exclusively on voting. In our model, individuals debate in a public forum and potentially revise their preferences in light of deliberation. Once this process is exhausted, a voting rule is applied to aggregate post-deliberation preferences into a social choice. Restricting attention to three alternatives, we identify conditions under which a democracy is truth-revealing in the sense that the deliberation path and the voting rule will always lead to the correct social choice being made, irrespective of the original profile of preferences and size of the electorate (provided the latter is finite). A critical parameter in the model is the persuasion cost. When this is low, a democracy is almost always truth-revealing. When it is high, we have the standard social choice model and truthful revelation is impossible. Moreover, we identify when and only when truthful revelation occurs in an interesting intermediate case.