Constructing and evaluating core inflation measures from component‐level inflation data

This paper undertakes a comprehensive examination of 10 measures of core inflation and evaluates which measure produces the best forecast of headline inflation out‐of‐sample. We use the Personal Consumption Expenditure Price Index as our measure of inflation. We use two sets of components (17 and 50) of the Personal Consumption Expenditure Price Index to construct these core inflation measures and evaluate these measures at the three time horizons (6, 12 and 24 months) most relevant for monetary policy decisions. The best measure of core inflation for both sets of components and over all time horizons uses weights based on the first principal component of the disaggregated (component‐level) prices. Interestingly, the results vary by the number of components used; when more components are used the weights based on the persistence of each component is statistically equivalent to the weights generated by the first principal component. However, those forecasts using the persistence of 50 components are statistically worse than those generated using the first principal component of 17 components. The statistical superiority of the principal component method is due to the fact that it extracts (in the first principal component) the common source of variation in the component level prices that accurately describes trend inflation over the next 6–24 months.     

The modernity of Dedekind’s anticipations contained in What are numbers and what are they good for?

Archive for History of Exact Sciences - We show that Dedekind, in his proof of the principle of definition by mathematical recursion, used implicitly both the concept of an inductive cone from an...     

The expansion of GPCR transactivation-dependent signalling to include serine/threonine kinase receptors represents a new cell signalling frontier

G protein-coupled receptor (GPCR) signalling is mediated through transactivation-independent signalling pathways or the transactivation of protein tyrosine kinase receptors and the recently reported activation of the serine/threonine kinase receptors, most notably the transforming growth factor-β receptor family. Since the original observation of GPCR transactivation of protein tyrosine kinase receptors, there has been considerable work on the mechanism of transactivation and several pathways are prominent. These pathways include the “triple membrane bypass” pathway and the generation of reactive oxygen species. The recent recognition of GPCR transactivation of serine/threonine kinase receptors enormously broadens the GPCR signalling paradigm. It may be predicted that the transactivation of serine/threonine kinase receptors would have mechanistic similarities with transactivation of tyrosine kinase pathways; however, initial studies suggest that these two transactivation pathways are mechanistically distinct. Important questions are the relative importance of tyrosine and serine/threonine transactivation pathways, the contribution of transactivation to overall GPCR signalling, mechanisms of transactivation and the range of cell types in which this phenomenon occurs. The ultimate significance of transactivation-dependent signalling remains to be defined but it appears to be prominent and if so will represent a new cell signalling frontier.     

Pierre Duhem’s virtue epistemology

Duhem’s concept of ‘good sense’ is central to his philosophy of science, given that it is what allows scientists to decide between competing theories. Scientists must use good sense and have intellectual and moral virtues in order to be neutral arbiters of scientific theories, especially when choosing between empirically adequate theories. I discuss the parallels in Duhem’s views to those of virtue epistemologists, who understand justified belief as that arrived at by a cognitive agent with intellectual and moral virtues, showing how consideration of Duhem as a virtue epistemologist offers insights into his views, as well as providing possible answers to some puzzles about virtue epistemology. The extent to which Duhem holds that the intellectual and moral virtues of the scientist determine scientific knowledge has not been generally noticed.