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This paper explains and evaluates the transmissions and effectiveness of monetary policy shock in a simple Cash-in-Advance (CIA) economy with financial intermediates. Lucas-Fuerst's (1992) limited participation CIA models are able to explain decreasing nominal interest rates and increasing real economic activity with monetary expansion through limited participation monetary shock and the cost channel of monetary policy. Calvo's (1983) sticky price monetary model examines the real effects of money injections through firms price setting behaviour, but it fails to generate a negative correlation between nominal interest rates and money growth rate, which has been observed in the data. This paper employs McCandless (2008) financial intermediates CIA model to explain the transmissions and impacts of monetary shocks. The model does not request limited participation monetary shock or Keynesian type of sticky price/wage, to examine the lower nominal interest rate and increasing real economic activity with monetary expansion. By extending the model with Stockman's (1981) CIA constraint, it is able to account for both positive response of consumption subject to monetary innovations, which has been found in Leeper et al. (1996) and the positive correlation between output and consumption which has been observed in the data.

This paper examines the effectiveness of monetary aggregates through various nominal interest rates by integrating the financial sector into the Cash-in-Advance (CIA) economy. The model assumes that there are two types of representative agents in the financial sector, which are: productive banks and financial intermediates. The productive banks supply a financial service, which is an exchange technology service to households and financial intermediates receive savings fund from savers and offer loans to borrowers. The monetary expansions are increased banking costs through the rate of inflation. It leads households to use more exchange credit relative to cash at the goods market. Since the number of savings funds is equal to the number of exchange credits used at the goods market, money injections are lower the nominal interest rate on saving as the saving fund increases with exchange credit. By assuming that firms are the only borrowers at the capital market from Fuerst (1992), a lower nominal interest rate on the saving fund reduces the marginal cost of labour and increases labour demand. Meanwhile, the increasing marginal cost of money through the expected inflation effect has a negative effect on labour supply. With labour demand dominating labour supply effects, both output and employment increase with monetary expansion. The paper is able to generate a decreasing nominal interest rate with an increasing money supply with an absence of limited participation monetary shocks from Lucas (1990); and by allowing firms to borrow wage bills payment from financial intermediates, it examines the positive response of aggregate output subject to monetary expansion under flexible price framework.

Authoritarian rule requires teamwork of political elites. However, elite class members may lack incentive for the contribution of their efforts. In this paper, we develop a model to study the decision of authoritarian rulers to introduce elections. Our model suggests that elections can motivate the ruling class to devote more effort to public good provision. As a result, elections alleviate the moral-hazard-in-teams problem within the authoritarian government. Excessive electoral control hinders the introduction of elections, but mild electoral control facilitates it. Our findings offer a new perspective on understanding authoritarian elections and explain many stylized facts in authoritarian regimes.

This article conducts a comparative study on the effectiveness of ventilation to mitigate blasting effects on spherical chambers subjected to internal detonations of high explosives through finite element analysis using the software package AUTODYN. Numerical simulations show that ventilation is ineffective in mitigating the damage of spherical chambers subjected to internal high explosives explosions because the chamber response is mainly described by high-frequency membrane modes. Openings do not reduce the chamber response despite they can reduce the blast overpressure after the chamber reaches its peak response. Worse still, openings lead to stress concentration, which weakens the structure. Therefore, small openings may reduce the capacity of the chamber to resist internal explosions. In addition, because large shock waves impose the chamber to respond to a reverberation frequency associated with the re-reflected shock wave pulses, secondary re-reflected shock waves can govern the chamber response, and plastic/elastic resonance can occur to the chamber. Simulations show that the time lag between the first and the second shock wave ranges from 3 to 7 times the arrival time of the first shock wave, implying that the current simplified design approach should be revised. The response of chambers subjected to eccentric detonations is also studied. Results show that due to asymmetric explosions, other membrane modes may govern the chamber response and causes localized damage, implying that ventilation is also ineffective to mitigate the damage of spherical chambers subjected to eccentric detonations. ; Australian Research Council Chilean government National Basic Research Program of China 2015CB058003