Browsing by Author "Blanco, Herminio A."
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Item Empirical evidence on the demand and supply of money; the case of Cyprus(1983) Philippou, Andreas A.; Blanco, Herminio A.; Smith, Gordon W.; Soligo, RonaldThis thesis explores the nature of the demand and supply of money through the use of econometric tools. The interest rates are fixed in Cyprus and, therefore, an alternative way of measuring the cost of holding money has to be used. The tests show that the expected rate of inflation is the best substitute. Money demand is found to be a function of income, money stock in the previous period and the expected rate of inflation. Testing of the supply equation shows that the money multiplier is stable over time. Both equations are stable and have good forecasting ability. Finally, the joint estimation of supply and demand yields more efficient estimators than those found by estimating the equations individually.Item Inflation and the Crawling Peg: the Peruvian case(1982) Choy, Ines Marylin; Blanco, Herminio A.; Huddle, Donald L.; Smith, Gordon W.It is suggested that in cases of frequent changes in the exchange rate, like in the Crawling Peg system, a vicious circle might develop: depreciation of the exchange rate may lead to increased domestic inflationary pressures and further rounds of changes in the exchange rate. This mechanism may be present in the Peruvian economy. A system of Crawling Peg has been adopted and although the deficit in the balance of payments was eliminated, the domestic rate of inflation is still very high. However, in the strict econometric sense, it is difficult to affirm that inflation causes changes in the exchange rate or vice versa because both variables are determined by factors such as the underlying monetary and fiscal policies. In order to examine the relationship between inflation and changes in the exchange rate a model is tested for the Peruvian case. In this model the exchange rate, international reserves and the rate of inflation are jointly determined. Although there is not a direct causality, in the econometric sense, there is a relationship between both variables. As long as the domestic rate of inflation is higher than the world rate of inflation there will be feedback between inflation and changes in the exchange rate.Item Japan's use of capital controls for exchange-rate management, 1975-1982(1983) Bennett, Sylvia K.; Smith, Gordon W.; Blanco, Herminio A.; Huddle, Donald L.Over the period of 1975-1982, Japan experienced substantial fluctuations in its currency and its current account position. With the oil price shocks and the evolution of the floating exchange rate system, much pressure was placed on the yen. A popular balance of payments policy used by Japan and several other countries has been to impose certain restrictions on capital exports and/or capital imports to offset or reinforce the relative currency demands related to merchandise and services trade. This thesis examines how Japan's use of capital controls changed over the years 1975-1982 to accommodate changes in the current account of the balance of payments. Examination of movements in components of the capital account and in covered interest differentials, in relation to changes in capital controls, demonstrates that there is presumption that the controls were largely effective in Japan's case, during most of the period under study. But as the general international climate for capital flows became more liberal, Japan's controls weakened. There is evidence that the controls were then not successful in stemming the desired capital flows.Item Scale effects in the Southern Electric Utility industry and the performance of Houston Lighting and Power relative to other southern utilities(1984) Krasner, Thomas P.; Young, Richard D.; Huddle, Donald L.; Blanco, Herminio A.Using an econometric, cost function analysis, the author found large economies of scale, and in some cases, large diseconomies of scale associated with firm size. The regressions supported the findings of previous authors, which suggest the existence of constant returns to scale for fimrs above 4 MW. The effect of capacity factor proved to be minor. Input prices as well as regional and technological distinctions explained significant cost variation. Cost differences between Houston Lighting and Power and the other companies in the sample, whether positive or negative, seemed due to economies of scale and HL&P's wage structure. In most cases these cost differences were minor. HL&P’s recent nuclear and coal construction programs were also considered. HL&P initiated its nuclear construction program in national and regional environments which favored nuclear power. According to cost estimates in the 197s, nuclear generating costs would undercut those of coal or lignite. Like other utilities, HL&P seemed to not anticipate future nuclear cost escalation. Further contributing to its cost overruns, HL&P hired Brown & Root, a contractor without previous nuclear experience, and failed to provide adequate quality control. HL&P's coal construction costs appear reasonable. Its need for new coal plants, however, is debatable.