SearcharxivSearch

arXiv subjects

Kazuhiko Nishimura

Publications and source records attributed to Kazuhiko Nishimura.

15 recordsLinked to original sources

Computing Endogenous Transformations in Processing Networks: A Dynamic Calibration Approach

Understanding how supply chains endogenously transform requires a parametric model of processing networks with non-neutral substitution elasticities. While the Cascaded CES production function provides a rigorous framework, dynamically calibrating its structural parameters from time-series data constitutes a highly non-convex inverse optimization problem. Since enforcing strict microeconomic concavity renders standard monolithic approaches computationally intractable, we propose a novel structure-exploiting algorithm to bypass this limitation. By leveraging the physical upstreamness topology of the network, our hybrid heuristic effectively breaks the curse of dimensionality inherent in economywide processing networks. Applying this framework to U.S. time-series data, we provide a scalable computational engine to fully endogenize complex supply-chain transformations, ultimately uncovering the elastic origins of asymmetric macroeconomic tail risks.

econ.GN

Structural Cointegration of the Climate-Carbon Feedback: Evidence from the Last 130,000 Years

Using a gap-free, millennial-resolution ice-core record spanning the last 130,000 years, we identify the feedback architecture between Antarctic temperature and atmospheric CO$_2$. The series are found to be cointegrated, justifying estimation with a Vector Error Correction Model (VECM). The estimated long-run relationship yields a temperature change of 13.0 K per CO$_2$ doubling. Structural identification combining Milankovitch-cycle instrumental variables with the VECM residuals yields a contemporaneous carbon response (CCR) that closely aligns with the thermodynamic bounds of Henry's Law. For the contemporaneous temperature response (CTR), the estimated confidence interval fully encompasses the theoretical Planck response. Accounting for structural lags and error correction, the cumulative temperature response within one millennium of CO$_2$ doubling reaches 11.8 K, successfully quantifying the delayed manifestation of the greenhouse effect.

physics.ao-ph

Optimal longevity of a dynasty

Standard optimal growth models implicitly impose a ``perpetual existence'' constraint, which can ethically justify infinite misery in stagnant economies. This paper investigates the optimal longevity of a dynasty within a Critical-Level Utilitarian (CLU) framework. By treating the planning horizon as an endogenous choice variable, we establish a structural isomorphism between static population ethics and dynamic growth theory. Our analysis derives closed-form solutions for optimal consumption and longevity in a roundabout production economy. We show that under low productivity, a finite horizon is structurally optimal to avoid the creation of lives not worth living. This result suggests that the termination of a dynasty can be interpreted not as a failure of sustainability, but as an altruistic termination to prevent intergenerational suffering. We also highlight an ethical asymmetry: while a finite horizon is optimal for declining economies, growing economies under intergenerational equity demand the ultimate sacrifice from the current generation.

econ.GN

Price Responses of Rwandan Tungsten Exports under Conflict Minerals Regulation

Section 1502 of the Dodd--Frank Act, enacted in 2010, requires U.S.-listed companies using tin, tantalum, tungsten, and gold (3TG) from the Democratic Republic of the Congo and adjoining countries to disclose information on the minerals' origins. Concerns have been raised that the regulation may have induced a de facto embargo through avoidance of sourcing from the covered region. However, how the price responsiveness of mineral exports evolved under changing institutional and market conditions remains insufficiently understood. Since tungsten production in the covered region is concentrated almost entirely in Rwanda, this study examines the price responsiveness of Rwandan tungsten exports from January 2009 to December 2023. Because missing export quantity data prevent continuous observation of export unit values, we apply the identification approach of Nakano and Nishimura (2025), combining monthly mirror trade data from UN Comtrade with exchange rates and a world average price. An importer fixed-effects model is estimated using export value as the dependent variable, with the sample divided into four periods according to changes in the institutional and market environment. The results reveal substantial temporal variation in price responsiveness. A statistically significant negative price response is observed in Period 1 ($η=-20.814$, $p<0.01$), disappears in Period 2 ($η=1.814$, $p>0.10$), reappears in Period 3 ($η=-5.277$, $p<0.01$), and disappears again in Period 4 ($η=0.440$, $p>0.10$). Coefficient-difference tests confirm significant changes between Periods 1 and 2 ($p=0.0021$) and between Periods 3 and 4 ($p=0.0006$). These findings suggest that the price responsiveness of Rwandan tungsten exports varied substantially over time rather than following a uniform trajectory after the regulation.

econ.GN

The Impact of Dodd-Frank and the Huawei Shock on DRC Tin Exports

This paper investigates the structural transformation of the Democratic Republic of the Congo (DRC) tin market induced by the U.S. Dodd-Frank Act. Focusing on the breakdown of the pricing mechanism, we estimate the price elasticity of export demand from 2010 to October 2022 using a structural identification strategy that overcomes the lack of reliable unit value data. Our analysis reveals that the regulation effectively destroyed the price mechanism, with demand elasticity dropping to zero. This indicates the formation of a ``captive market'' driven by certification requirements rather than price competitiveness. Also, we find strong hysteresis; deregulation alone failed to restore market flexibility. The structural rigidity was finally broken not by policy suspension, but by the 2019 ``Huawei shock,'' an external demand surge that forced supply chain diversification.

econ.GN

Nonlinear Domar aggregation over transforming production networks

An economy-wide production network, manifested through monetary input-output coefficients, inherently destabilizes during the general equilibrium propagation of sectoral productivity shocks when substitution elasticities are non-neutral. This study explores the global properties of such networks by mapping the non-linear price manifold into a linearized \textit{transcendent space}. Within this framework, we identify the emergence of network \textit{singularities}, identifying the metabolic thresholds where productivity declines lead to supply-chain paralysis or efficiency gains render primary factors redundant. Furthermore, we demonstrate that the interaction between productivity shocks -- the sign of \textit{synergism} -- is uniquely determined by the substitution elasticity $σ$. Our findings transform industrial policy into an \textit{inverse problem} of network topology: we provide a rigorous justification for why an inelastic network necessitates selective concentration on bottleneck sectors, whereas an elastic network favors a diversified investment strategy.

econ.TH

How do we measure trade elasticity for services?

This paper is about our attempt of identifying trade elasticities through the variations in the exchange rate, for possible applications to the case of services whose physical transactions are veiled in the trade statistics. The regression analysis to estimate the elasticity entails a situation where the explanatory variable is leaked into the error term through the latent supply equation, causing an endogeneity problem for which an instrumental variable cannot be found. Our identification strategy is to utilize the normalizing condition, which enables the supply parameter to be identified, along with the reduced-form equation of the system of demand and supply equations. We evaluate the performances of the method proposed by applying to several different tangible goods, whose benchmark trade elasticities are estimable by utilizing the information on their physical transactions.

econ.GN

The elastic origins of tail asymmetry

Based on a multisector general equilibrium framework, we show that the sectoral elasticity of substitution plays the key role in the evolution of asymmetric tails of macroeconomic fluctuations and the establishment of robustness against productivity shocks. Non-unitary elasticity of substitution renders a nonlinear Domar aggregation, where normal sectoral productivity shocks translate into non-normal aggregated shocks with variable expected output growth. We empirically estimate 100 sectoral elasticities of substitution, using the time-series linked input-output tables for Japan, and find that the production economy is elastic overall, relative to Cobb-Douglas with unitary elasticity. Along with the previous assessment of an inelastic production economy for the US, the contrasting tail asymmetry of the distribution of aggregated shocks between the US and Japan is explained. Moreover, robustness of an economy is assessed by the expected output growth, the level of which is led by the sectoral elasticities of substitution, under zero mean productivity shocks.

econ.GN

On estimating Armington elasticities for Japan's meat imports

By fully accounting for the distinct tariff regimes levied on imported meat, we estimate substitution elasticities of Japan's two-stage import aggregation functions for beef, chicken and pork. While the regression analysis crucially depends on the price that consumers face, the post-tariff price of imported meat depends not only on ad valorem duties but also on tariff rate quotas and gate price system regimes. The effective tariff rate is consequently evaluated by utilizing monthly transaction data. To address potential endogeneity problems, we apply exchange rates that we believe to be independent of the demand shocks for imported meat. The panel nature of the data allows us to retrieve the first-stage aggregates via time dummy variables, free of demand shocks, to be used as part of the explanatory variable and as an instrument in the second-stage regression.

econ.EM

Productivity propagation with networks transformation

We model sectoral production by cascading binary compounding processes. The sequence of processes is discovered in a self-similar hierarchical structure stylized in the economy-wide networks of production. Nested substitution elasticities and Hicks-neutral productivity growth are measured such that the general equilibrium feedbacks between all sectoral unit cost functions replicate the transformation of networks observed as a set of two temporally distant input-output coefficient matrices. We examine this system of unit cost functions to determine how idiosyncratic sectoral productivity shocks propagate into aggregate macroeconomic fluctuations in light of potential network transformation. Additionally, we study how sectoral productivity increments propagate into the dynamic general equilibrium, thereby allowing network transformation and ultimately producing social benefits.

econ.GN

Restoration and extrapolation of structural transformation by dynamical general equilibrium feedbacks

We model sectoral production by serially nesting (cascading) binary compounding processes. The sequence of processes is discovered in a self-similar hierarchical structure stylized in macroscopic input-output transactions. The feedback system of unit cost functions, with recursively estimated nest-wise CES parameters, is calibrated for sectoral productivities to replicate two temporally distant cost share structures, observed in a set of linked input--output tables. We model representative households by multifactor CES, with parameters estimated by fixed effects regressions. By the integrated dynamic general equilibrium model, we extrapolate potential structural transformations, and measure the associated welfare changes, caused by exogenous sectoral productivity shocks.

stat.AP

Structural propagation in a production network with restoring substitution elasticities

We model an economy-wide production network by cascading binary compounding functions, based on the sequential processing nature of the production activities. As we observe a hierarchy among the intermediate processes spanning the empirical input--output transactions, we utilize a stylized sequence of processes for modeling the intra-sectoral production activities. Under the productivity growth that we measure jointly with the state-restoring elasticity parameters for each sectoral activity, the network of production completely replicates the records of multi-sectoral general equilibrium prices and shares for all factor inputs observed in two temporally distant states. Thereupon, we study propagation of a small exogenous productivity shock onto the structure of production networks by way of hierarchical clustering.

econ.GN

Optimal Population in a Finite Horizon

A favorable population schedule for the entire potential human family is sought, under the overlapping generations framework, by treating population (or fertility) as a planning variable in a dynamical social welfare maximization context. The utilitarian and maximin social welfare functions are examined, with zero future discounting, while infinity in the maximand is circumvented by introducing the depletion of energy resources and its postponement through technological innovations. The model is formulated as a free-horizon dynamical planning problem, solved via a non-linear optimizer. Under exploratory scenarios, we visualize the potential trade-offs between the two welfare criteria.

econ.GN

Bilateral multifactor CES general equilibrium with state-replicating Armington elasticities

We measure elasticity of substitution between foreign and domestic commodities by two-point calibration such that the Armington aggregator can replicate the two temporally distant observations of market shares and prices. Along with the sectoral multifactor CES elasticities which we estimate by regression using a set of disaggregated linked input--output observations, we integrate domestic production of two countries, namely, Japan and the Republic of Korea, with bilateral trade models and construct a bilateral general equilibrium model. Finally, we make an assessment of a tariff elimination scheme between the two countries.

econ.GN

Multifactor CES General Equilibrium: Models and Applications

Sector specific multifactor CES elasticity of substitution and the corresponding productivity growths are jointly measured by regressing the growths of factor-wise cost shares against the growths of factor prices. We use linked input-output tables for Japan and the Republic of Korea as the data source for factor price and cost shares in two temporally distant states. We then construct a multi-sectoral general equilibrium model using the system of estimated CES unit cost functions, and evaluate the economy-wide propagation of an exogenous productivity stimuli, in terms of welfare. Further, we examine the differences between models based on a priori elasticity such as Leontief and Cobb-Douglas.

stat.AP