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Beyond the Event Horizon: Peak Risk-Adjusted Performance in Post-Event Markets
Get PDFWe develop a dynamic asset pricing model to analyze investor behavior around high-uncertainty events such as earnings announcements and FDA approvals. Our key innovations include: (1) a two-risk framework distinguishing between directional news risk (uncertainty about event outcomes) and impact uncertainty (uncertainty about market response magnitude); (2) a three-phase volatility process (pre-event rise, event-day peak, post-event dynamics) modeled through GJR-GARCH specifications; and (3) integration of heterogeneous investor beliefs and asymmetric transaction costs. Investors with mean-variance preferences trade an event-related asset and a generic risky asset in a multi-period framework. We solve for equilibrium prices with three investor types: informed, uninformed, and liquidity traders. Our model generates a testable hypothesis predicting that risk-adjusted returns, specifically return-to-variance and Sharpe ratios, peak during the post-event rising phase due to high volatility and biased expectations. Empirical validation using 2000-2024 data from earnings announcements and FDA approvals provides exceptionally strong support for our predictions, with return-to-variance ratios showing 4.4x amplification for FDA approvals and 9.5x enhancement for earnings announcements during the post-event rising phase. The framework provides insights for risk management and investment timing around high-uncertainty events
A propósito das políticas públicas de coesão territorial em Portugal: Um contributo para a avaliação dos seus efeitos
Get PDFThe existence of significant and persistent regional disparities in a country with reduced territorial dimensions, such as Portugal, is a fact that demands reflection on its causes and effects. This reflection is particularly necessary since, as Portugal is a European Union (EU) country, public policies of territorial cohesion have been implemented, as part of the EU cohesion policy, the objective of which is precisely to reduce those regional disparities. Thus, based on the empirical evidence for the territorial inequalities that characterize Portugal, the (main) objective of this work is to draw attention to the need to complete the cycle of any public policy, through the evaluation of its effects
Total Output of the Future
Get PDFThis paper develops a theory of growth with self-learning AI. I decompose “technologies” into a non-self-learning component T(t) and a recursive self-learning term (S(t) D(t))(t), where (t) = 0 + log(S(t) D(t)) links capability gains to deployed self-learning technologies S and data D. I present two complementary production functions. Version 1 highlights distributional channels by separating AI-complementary vs. AI-substitutable labor and human capital. Version 2 is measurement-oriented, mapping the self-learning stock to AI-specific physical capital, labor forces, and human capital, thereby operationalizing S. The model yields sharp regime conditions: with small/approximately constant (t), the economy exhibits a balanced growth path (BGP); when θ(t) becomes large enough to push effective returns above one, growth accelerates. A log-space recursion implies a quadratic bound for log((SD)(t)), establishing no finite-time singularity. The framework produces testable predictions—notably the need for both linear and quadratic terms in log(SD) in empirical specifications—and clarifies bottlenecks: insufficient AI-specific capital or low-quality data can hold down θ(t) and prevent acceleration even with advanced systems. Policy implications follow directly: scale compute and energy, raise HAI, LAI, and improve data governance/quality. The contribution is conceptual and theory-only, positioning the mechanism for subsequent empirical work while providing a tractable structure for cross-country comparisons in an economy increasingly driven by recursive, autonomous innovation
The Phantom Menace in Agriculture: How Lagged Droughts Distort Input Decisions and Create Environmental Deadweight Loss
Get PDFThe overuse of chemical fertilizers is a global problem that has led to a series of adverse effects on the environment and human well-being. This study identifies a novel cause of fertilizer overuse: farmers’ irrational responses to lagged droughts. Employing unique plot-level data from maize production in China, we find that while drought shocks in any given year are independent, a drought in the previous year increases fertilizer use in the current year by 14.2%, with no positive effect on yield. A simple extrapolation suggests that this irrational response to lagged droughts causes an annual total fertilizer overuse of 1.1 million tons in China. This could translate to a monetary cost of 486 mil
lion USD, drinking water pollution of 2-6 billion cubic meters, and carbon emissions of 8.9 million tons. Fertilizer overuse is expected to increase substantially under future climate change scenarios. We identify investment in irrigation, land consolidation toward high-productivity farmers, and the promotion of drought-tolerant crop varieties as key approaches to mitigating drought-induced fertilizer overuse
Съдебната практика по чл. 10, ал. 1 от Кодекса за социално осигуряване и загубване на качеството „осигурено лице“
Get PDFРезюме: Научното изследване представя противоречивата съдебна практика в периода 2014–2025 г. относно правомощието на контролните органи на Националния осигурителен институт да издават задължителни предписания за заличаване на данни по чл. 5, ал. 4, т. 1 от Кодекса за социално осигуряване, както и относно тълкуването и прилагането на чл. 10, ал. 1 от Кодекса за социално осигуряване. Въз основа на доктриналния анализ са направени две предложения за образуване на тълкувателни дела и за приемане на тълкувателни решения от Общото събрание на колегиите на Върховния административен съд.
Abstract: The scientific study presents the contradictory case law in the period 2014–2025 regarding the authority of the control bodies of the National Social Security Institute to issue mandatory instructions for deletion of data under Art. 5, para. 4, item 1 of the Social Security Code, as well as on the interpretation and application of Art. 10, para. 1 of the Social Security Code. Based on the doctrinal analysis, two proposals have been made for initiating interpretative cases and for adopting interpretative decisions by the General Assembly of the Colleges of the Supreme Administrative Court
When Do Investors Buy Rental Properties? Insights From A Theoretical and Empirical Investigation of Housing Market Breakeven Vacancies
Get PDFReal estate is an attractive investment asset because it provides positive cash flows from rents and prospects of valuation gains. This paper studies the housing market breakeven vacancy, the extent to which an investor needs to rent a property to equalize its costs and benefits. As a metric in rental property investment screening, investors are more likely to buy when the breakeven vacancy is high such that the transaction has a promising prospect of breakeven or better. An original asset pricing model is developed to define the housing market breakeven vacancy. The theoretical model reveals that the breakeven vacancy is not static but nonlinearly determined by housing price growth, price-to-rent ratios, interest rates, operating expenses, and rental income taxes. While higher housing price growth, lower interest rates, and smaller operating expenses lead to larger breakeven vacancies, price-to-rent ratios and rental income taxes hold theoretically ambiguous effects. Furthermore, housing market breakeven vacancies are estimated using country-level data from 12 developed nations and regional data from 30 U.S. metropolitan areas. Empirical analysis suggests that declining interest rates and rising price-to-rent ratios have fueled the ascent of breakeven vacancies until 2022, while house price collapses around crises have led to slumps in breakeven vacancies. Lastly, the housing market breakeven vacancy estimates are highly correlated with actual investment home purchases in the United States at national and regional levels, highlighting the practical relevance of this metric for income-producing property investments
Numerical Simulation of Reaching a Steady State: Effects of Using Progressive Income Tax and Public Assistance
Get PDFIn a heterogeneous population, a steady state cannot necessarily be guaranteed unless a government appropriately intervenes. I numerically simulate whether a steady state can be reached by means of progressive income taxes and public assistance in the case that households are heterogeneous in probabilities of obtaining persistent rent incomes. Simulation results indicate that, in many cases, a steady state can be reached, but at the same time a high level of economic inequality is generated. This occurs because progressive income taxes can “confiscate” persistent rent incomes, but they cannot compensate for the extracted economic resources resulting from rent incomes. Simulation results also indicate that large-scale public assistance is needed to reduce inequality, but it will be difficult to actually implement due to difficulties in distinguishing between persistent rent incomes and other types of income. As a result, a high level of economic inequality will remain even with progressive income taxes
Geographical concentration and stability of furniture exports from Bulgaria
Get PDFThe paper analyses the geographical concentration and sustainability of furniture exports from Bulgaria for the period 2015-2024. The focus of the research is on the main trading partners and the dynamics of foreign trade relationships. The methodology used is based on the application of geographical concentration (GCr) and geographical sustainability (GSr) indicators. The findings of the analysis indicate that a balanced structure, sustainability over time, and limited dependence on external shocks characterise the export of furniture from Bulgaria. Major trading partners account for approximately 51% of total exports, with 74% of them maintaining their positions in the top 5 over the entire analysed perio
Energy Transformation in the Kurdistan Region: Clean Electricity Economy within the Scope of the Runaki Project
Get PDFThis study will examine the economic impacts of a transformation in which clean energy becomes more prevalent in the Kurdistan Region, within the scope of the Runaki Project. The elimination of approximately 3,200 private generators within the scope of the Runaki Project marks the first step in transitioning to clean electricity in the Kurdistan Region. Thanks to the Runaki, cities such as Erbil, Duhok, Slemani, Halabja, and their districts started to have access to clean electricity and benefit from uninterrupted electrical energy. Before the Runaki Project, electricity costs in the Kurdistan Region were reflected in high bills due to private generators that took advantage of power outages and caused air pollution. Therefore, people’s budgets were negatively affected due to high electricity costs. In line with the decision taken by the Kurdistan Regional Government (KRG), with an investment of approximately $200 million regarding the Runaki Project, works are ongoing to eliminate air pollution, provide clean and uninterrupted electricity, and ensure that affordable electricity will be widespread throughout the Kurdistan Region by the end of 2026. In the long term, the transition to clean energy in the Kurdistan Region within the scope of the Runaki Project is expected to contribute to economic growth and prevent the recent slowdown in productivity in the Kurdistan Region. It is envisioned that the Runaki Project will contribute to economic prosperity in the Kurdistan Region within the context of the 2030-2050 Sustainable Development Goals (SDGs) and as a measure to mitigate the climate crisis resulting from global warming. In this context, the Runaki Project has observed that efforts to combat inflation, increase employment, and prevent recession in the Kurdistan Region are accelerating, yielding numerous economic benefits. The Runaki Project will enhance the electricity grid, lower electricity costs throughout the Kurdistan Region, and provide additional savings for the citizens of the Kurdistan Region
Modeling Wage Expectations and Long-Memory Dynamics in the German Labor Market, 1914–1920
Get PDFThis study simulates the labor market dynamics in Germany during 1914-1920, focusing on the impact of World War I on wage expectations and economic stability. Built upon the historical context of the period, the simulation takes into account the initial wage hikes driven by involuntary unemployment and the exodus of workers from civilian industries to war-related industries. It then explores the subsequent stabilization of wages, as observed in the empirical reality of the era. Using simulated data, the paper examines how workers' expectations of future wages were shaped by current wage conditions amidst the economic strain caused by the war. The study also investigates the role of national unity, government policies, and institutional frameworks in preserving wage stability during market volatility. To analyze wage dynamics, the research applies a dynamic wage model alongside the FIGARCH(1,d,1) model, estimating long-memory effects in wage volatility. The findings suggest that past economic conditions played a significant role in shaping current wage expectations, with light long-memory properties observed in wage volatility. This simulated analysis offers insights into how economic pressures and government interventions during wartime may have contributed to wage stability, shaping the uncertainty of workers into forecasting the war ending which goes in accordance with the martingale hypothesis of wages expectations. Our study is contextual and qualitative and discusses the properties of economical series based on the context of the period