References of "Koulovatianos, Christos 50002127"
     in
Bookmark and Share    
See detailDemographics and FDI: Lessons from China's one-child policy
Donaldson, John; Koulovatianos, Christos UL; Li, Jian et al

Article for general public (2018)

China’s one-child policy increased its capital-labour ratio and reduced FDI inflows relative to India, consistent with neoclassical fundamentals

Detailed reference viewed: 84 (4 UL)
Full Text
See detailDemographics and FDI: Lessons from China's One-Child Policy
Donaldson, John B.; Koulovatianos, Christos UL; Li, Jian et al

E-print/Working paper (2018)

Lucas (1990) argues that the neoclassical adjustment process fails to explain the relative paucity of FDI inflows from rich to poor countries. In this paper we consider a natural experiment: using China ... [more ▼]

Lucas (1990) argues that the neoclassical adjustment process fails to explain the relative paucity of FDI inflows from rich to poor countries. In this paper we consider a natural experiment: using China as the treated country and India as the control, we show that the dynamics of the relative FDI flows subsequent to the implementation of China's one-child policy, as seen in the data, are consistent with neoclassical fundamentals. In particular, following the introduction of the one-child policy in China, the capital-labor (K/L) ratio of China increased relative to that of India, and, simultaneously, relative FDI inflows into China vs. India declined. These observations are explained in the context of a simple neoclassical OLG paradigm. The adjustment mechanism works as follows: the reduction in the (urban) labor force due to the one-child policy increases the savings per capita. This increases the K/L ratio and reduces the marginal product of capital (MPK). The reduction in MPK (relative to India) reduces the relative attractiveness of investment in China and is thus associated with lower FDI/GDP ratios. Our paper contributes to the nascent literature exploring demographic transitions and their effects on FDI flows. [less ▲]

Detailed reference viewed: 108 (14 UL)
Full Text
Peer Reviewed
See detailMarket fragility and the paradox of the recent stock-bond dissonance
Koulovatianos, Christos UL; Li, Jian; Weber, Fabienne UL

in Economics Letters (2018), 162

After the Lehman-Brothers collapse, the stock index has exceeded its pre-Lehman-Brothers peak by 36% in real terms. Seemingly, markets have been demanding more stocks instead of bonds. Yet, instead of ... [more ▼]

After the Lehman-Brothers collapse, the stock index has exceeded its pre-Lehman-Brothers peak by 36% in real terms. Seemingly, markets have been demanding more stocks instead of bonds. Yet, instead of observing higher bond rates, paradoxically, bond rates have been persistently negative after the Lehman-Brothers collapse. To explain this paradox, we suggest that, in the post-Lehman-Brothers period, investors changed their perceptions on disasters, thinking that disasters occur once every 30 years on average, instead of disasters occurring once every 60 years. In our asset-pricing calibration exercise, this rise in perceived market fragility alone can explain the drop in both bond rates and price–dividend ratios observed after the Lehman-Brothers collapse, which indicates that markets mostly demanded bonds instead of stocks. [less ▲]

Detailed reference viewed: 122 (10 UL)
Full Text
Peer Reviewed
See detailDo Demographics Prevent Consumption Aggregates From Reflecting Micro-Level Preferences?
Koulovatianos, Christos UL; Carsten, Schroeder; Ulrich, Schmidt

in European Economic Review (2018)

Most simulated micro-founded macro models use solely consumer-demand aggregates in order to estimate preference parameters of a representative consumer, for use in policy evaluation. Focusing on dynamic ... [more ▼]

Most simulated micro-founded macro models use solely consumer-demand aggregates in order to estimate preference parameters of a representative consumer, for use in policy evaluation. Focusing on dynamic models with time-separable preferences, we show that aggregation holds if, and only if, momentary utility functions fall in the Identical-Shape Harmonic Absolute-Risk Aversion (ISHARA) utility class, identifying which parameters of ISHARA utility functions are allowed to vary over time. Given this theoretical result, it should be easy to empirically reject the aggregation properties that the macroeconomic representative-consumer identification approach requires: it suffices to show that permanent incomes guaranteeing the same living standard across households of different size violate an affine relationship. In order to test the validity of this affine equation, we develop a vignette survey that produces appropriate data without demand-estimation restrictions imposed by models. Surprisingly, in six countries, this equation is not rejected, lending support to using consumer-demand aggregates. [less ▲]

Detailed reference viewed: 89 (5 UL)
See detailEvaluating How Child Allowances and Daycare Subsidies Affect Fertility
Goldstein, Joshua R.; Koulovatianos, Christos UL; Li, Jian UL et al

E-print/Working paper (2017)

We compare the cost effectiveness of two pronatalist policies: (a) child allowances; and (b) daycare subsidies. We pay special attention to estimating how intended fertility (fertility before children are ... [more ▼]

We compare the cost effectiveness of two pronatalist policies: (a) child allowances; and (b) daycare subsidies. We pay special attention to estimating how intended fertility (fertility before children are born) responds to these policies. We use two evaluation tools: (i) a dynamic model on fertility, labor supply, outsourced childcare time, parental time, asset accumulation and consumption; and (ii) randomized vignette-survey policy experiments. We implement both tools in the United States and Germany, finding consistent evidence that daycare subsidies are more cost effective. Nevertheless, the required public expenditure to increase fertility to the replacement level might be viewed as prohibitively high. [less ▲]

Detailed reference viewed: 65 (5 UL)
See detailAsset Pricing under Rational Learning about Rare Disasters
Koulovatianos, Christos UL; Wieland, Volker

Scientific Conference (2017, January 07)

Why is investment in stocks so persistently weak after a rare disaster? Connecting disaster episodes with post-disaster expectations seems crucial for such post-disaster forecasting and also policymaking ... [more ▼]

Why is investment in stocks so persistently weak after a rare disaster? Connecting disaster episodes with post-disaster expectations seems crucial for such post-disaster forecasting and also policymaking, but rational-expectations models with variable disaster risk often fail to achieve this connection. To this end, while retaining full rationality, we introduce limited information and learning about rare-disaster risk and show that the resulting stock-investment behavior seems similar to persistent investor fear after a rare disaster. We study, (a) rational learning for state verification (RLS), with investors knowing the data-generating process of disaster riskiness but being unable to observe whether the economy is in a riskier state (regime) or not, and (b) rational learning about the data-generating process (RLP) of disaster risk, with investors also being unaware of the data-generating process of disaster riskiness. We analytically show that both RLS and RLP synchronize disaster events with post-disaster expectations and asset prices, and create persistence in price-dividend ratios even if data-generating processes of disaster risk have no persistence. Using De Finetti's theorem we show that RLP offers an explanation for global spells of pessimism and weak investment after a disaster. [less ▲]

Detailed reference viewed: 92 (4 UL)
Full Text
See detailPolitical Economics of Fiscal Consolidations and External Sovereign Accidents
Achury, Carolina; Koulovatianos, Christos UL; Tsoukalas, John

E-print/Working paper (2016)

As the recent chain of EU sovereign crises has demonstrated, after an unexpected massive rise to the debt GDP ratio, several EU countries manage to proceed with fiscal consolidation quickly and ... [more ▼]

As the recent chain of EU sovereign crises has demonstrated, after an unexpected massive rise to the debt GDP ratio, several EU countries manage to proceed with fiscal consolidation quickly and effectively, while other countries, notably Greece, proceed slowly, fueling Graccident and Grexit scenarios, even after generous rescue packages, involving debt haircuts and monitoring from official bodies. Here we recursively formulate a game among rent-seeking groups and propose that high debt-GDP ratios lead to predictable miscoordination among rent-seeking groups, unsustainable debt dynamics, and open the path to political accidents that foretell Graccident scenarios. Our analysis and application helps in under- standing the politico-economic sustainability of sovereign rescues, emphasizing the need for fiscal targets and possible debt haircuts. We provide a calibrated example that quantifies the threshold debt-GDP ratio at 137%, remarkably close to the target set for private sector involvement in the case of Greece. [less ▲]

Detailed reference viewed: 88 (9 UL)
Full Text
Peer Reviewed
See detailStrategic Exploitation of a Common Property Resource under Rational Learning About its Reproduction
Koulovatianos, Christos UL

in Dynamic Games and Applications (2015), 5

We build a workable game of common-property resource extraction under rational Bayesian learning about the reproduction prospects of a resource. We focus on Markov-perfect strategies under truthful ... [more ▼]

We build a workable game of common-property resource extraction under rational Bayesian learning about the reproduction prospects of a resource. We focus on Markov-perfect strategies under truthful revelation of beliefs. For reasonable initial conditions, exogenously shifting the prior beliefs of one player toward more pessimism about the potential of natural resources to reproduce can create anti-conservation incentives. The single player whose beliefs have been shifted toward more pessimism exhibits higher exploitation rate than before. In response, all other players reduce their exploitation rates in order to conserve the resource. However, the overall conservation incentive is weak, making the aggregate exploitation rate higher than before the pessimistic shift in beliefs of that single player. Due to this weakness in strategic conservation responses, if the number of players is relatively small, then in cases with common priors, jointly shifting all players’ beliefs toward more pessimism exacerbates the commons problem. [less ▲]

Detailed reference viewed: 75 (8 UL)
See detailCapital-value busts as a source of rational pessimistic policy swings
Koulovatianos, Christos UL; Mavridis, Dimitrios UL

Presentation (2014, November 14)

Detailed reference viewed: 218 (37 UL)
See detailFitting Parsimonious Household Portfolio models to Data
Hubar, Sylwia; Koulovatianos, Christos UL; Li, Jian UL

Presentation (2014, September 30)

Detailed reference viewed: 96 (14 UL)
See detailConfronting the Represetantive Consumer with Household-Size Heterogeneity
Koulovatianos, Christos UL; Schroeder, Carsten; Schmidt, Ulrich

Report (2014)

Detailed reference viewed: 47 (5 UL)
See detailFitting Parsimonious Household Portfolio models to Data (Keynote Speech)
Koulovatianos, Christos UL

Presentation (2014, June 20)

Detailed reference viewed: 39 (5 UL)
See detailFitting Parsimonious Household Portfolio models to Data
hubar, Sylwia; Koulovatianos, Christos UL; Li, Jian UL

Presentation (2014)

Detailed reference viewed: 108 (16 UL)
Full Text
See detailPolitical Economics of External Sovereign Defaults
Achury, Carolina; Koulovatianos, Christos UL; Tsoukalas, John

E-print/Working paper (2013)

We study how excessive debt-GDP ratios affect political sustainability of prudent fiscal policy in country members of a monetary union. We develop a model with free choice of distinct rent-seeking groups ... [more ▼]

We study how excessive debt-GDP ratios affect political sustainability of prudent fiscal policy in country members of a monetary union. We develop a model with free choice of distinct rent-seeking groups to cooperate (or not) in providing public goods, in seeking rents, and in austere debt issuing through international markets. Noncooperation of rent-seeking groups on fiscal prudence triggers collective fiscal impatience: fiscal debt is issued excessively because each group expropriates extra rents before other groups do so, too. Such collective fiscal impatience leads to a vicious circle of high international interest rates and external-debt default. Our calibration suggests that debt-GDP ratios below 137% foster cooperation among rent-seeking groups, which avoids collective fiscal impatience and default. Our analysis helps in understanding the politicoeconomic sustainability of sovereign rescue packages, emphasizing the need for fiscal targets and for possible debt haircuts. [less ▲]

Detailed reference viewed: 121 (10 UL)
Full Text
See detailAnalytical Guidance for Fitting Parsimonious Household-Portfolio Models to Data
Hubar, Sylwia; Koulovatianos, Christos UL; Li, Jian UL

E-print/Working paper (2013)

Saving rates and household investment in stocks and business equity are all increasing in income and wealth. Introducing subsistence consumption to a common-across-households Epstein-Zin-Weil utility ... [more ▼]

Saving rates and household investment in stocks and business equity are all increasing in income and wealth. Introducing subsistence consumption to a common-across-households Epstein-Zin-Weil utility function is up to a quantitative explanation, in the context of stan- dardized parsimonious household-portfolio models with risky income. Closed forms in a sim- plified version of the model, with insurable labor-income risk and no liquidity constraints, reveal that if, (i) risky-asset returns are weakly correlated and, (ii) household resources are expected to grow over time, then poorer households can afford exiting subsistence concerns slowly by saving less and by taking less risk, while holding balanced portfolios. [less ▲]

Detailed reference viewed: 50 (14 UL)
Full Text
Peer Reviewed
See detailStrategic Exploitation of a Common-Property Resource under Uncertainty
Koulovatianos, Christos UL; Antoniadou, Elena; Mirman, Leonard J.

in Journal of Environmental Economics and Management [= JEEM] (2013), 65(1), 28-39

We construct a game of noncooperative common-resource exploitation which delivers analytical solutions for its symmetric Markov-perfect Nash equilibrium. We examine how introducing uncertainty to the ... [more ▼]

We construct a game of noncooperative common-resource exploitation which delivers analytical solutions for its symmetric Markov-perfect Nash equilibrium. We examine how introducing uncertainty to the natural law of resource reproduction affects strategic exploitation. We show that the commons problem is always present in our example and we identify cases in which increases in risk amplify or mitigate the commons problem. For a specific class of games which imply Markov-perfect strategies that are linear in the resource stock (our example belongs to this class), we provide general results on how payoff-function features affect the responsiveness of exploitation strategies to changes in riskiness. These broader characterizations of games which imply linear strategies (appearing in an Online Appendix) can be useful in future work, given the technical difficulties that may arise by the possible nonlinearity of Markov-perfect strategies in more general settings. [less ▲]

Detailed reference viewed: 195 (121 UL)