While neurodegenerative disorders and epilepsy are widespread and costly diseases, current treatment options are limited and primarily target symptoms, rather than causes. Metabolic stress is a feature common to many NDDs an epilepsies. However, the mechanisms linking impairments in energy supply and utilization to neuropathology are unclear. We suggest that impaired neuronal energy homeostasis is a primary reason for the high seizure susceptibility in AD and epileptic patients, and the impaired synaptic plasticity in AD. Metabolic failure leads to abnormal neuronal signaling,resulting in an energy deficit, which triggers further aberrant neuronal activity, in a pathological, positive feedback loop. This vicious cycle can however be interrupted by the timely supply of an appropriate alternative energy source e.g., ketone bodies. In this project we will elucidate the mechanisms of neuronal metabolic protection in the developing and mature brains, in order to provide a rational basis for the treatment of NDDs and epilepsies.

Over the last 20 years major developments in growth theories that have pushed forward our understating of the growth process. One of the central concerns of this literature is to try to understand the causes and effects of output fluctuations. An important branch of business cycles studies is concerned with the way in which fluctuations endogenously develop in economic systems as a result of the dynamic properties of the equilibrium. Despite enormous progress in our understanding of endogenous fluctuations in the last two decades, these models suffer from an important drawback. In order to generate cycles they tend to require unrealistic parameter values of some of the key economic variables, such as a very responsive labour supply or large production externalities; see, for example, Benhabib and Nishimura (1998). The main objective of this project is to study variants of the basic models, in order to examine whether cycles are possible under more realistic parameter values. A positive answer to this question would have important policy implications. As is well-known, the policy recommendations derived from models of endogenous fluctuations are radically different from those obtained with the alternative theory of cycles, the real business cycle model. A systematic analysis of growth models that characterizes the circumstances under which endogenous fluctuations appear would, consequently, be an important step forward in our understanding of the origins of these fluctuations and in the devising of policy recommendations. The basic tool that has been used for this type of analysis is the Intertemporal General Equilibrium (IGE) model. Existing work on endogenous fluctuations has used the IGE framework and examined economies with identical agents, which are either closed to trade or small-open economies. In our work, we intend to retain the neoclassical growth framework used in previous studies (either in the finitely- or infinitely-lived agent variants) and examine two important extensions: on the one hand, we will examine a more complex open economy setup; on the other, we will allow for heterogeneity across agents. The project is organized around three main themes. The first one is concerned with the appearance of endogenous fluctuations in open economies. The empirical evidence has clearly shown that trade increases growth in almost all nations, yet there seems to be some evidence that both financial and commercial integration promote volatility. Our work on open economies will consider, on the one hand, the role of increased financial integration when there are credit constraints, and, on the other, the impact of trade in goods. In both cases, the central questions are the same: does increased international integration make volatility more likely? Does integration tend to propagate domestic business cycles to other countries? The second avenue of research consists in introducing different sources of heterogeneity across agents in the IGE model. Existing work on endogenous fluctuations has so far studied representative-agent setups. We intend to introduce heterogeneity both with respect to initial wealth endowments and preferences, in order to assess whether such heterogeneity makes fluctuations possible under reasonable parameter values. Our analysis will thus link distribution and volatility, an aspect that has received little attention in the literature. If inequality is a source of volatility, there will be important policy implications. Redistribution may be a possible way of reducing economic fluctuations, and as a result desirable from both an equity and an efficiency point of view. The central approach in this part of the project will be to extend the two-sector model developed by Ghiglino and Venditti (2006) to introduce elastic labor supply, and examine both the finitely- and infinitely-lived agents variants of the model. Once we allow for heterogeneity, the question arises of what are the effects of growth and cycles on the distributions of income and wealth. The third aspect of our research project intends to characterize distributional dynamics in growth models. We will study the evolution of inequality across agents in a growing economy in which agents differ in their initial capital endowment. The basic questions we want to ask is whether the growth process exacerbates or diminishes existing differences in initial wealth, and what are the implications for the distribution of income. The objective of the project is twofold. First, we will explore the full spectrum of circumstances in which the neoclassical growth model can give rise to different distributional dynamics. Second, we intend to calibrate the model to replicate recent changes in the distributions of income and wealth.