Can regulatory interventions alleviate financial crises? If so, which ones work? We draw inferences from the Japanese banking crisis of the 1990s using a hand-gathered database of bank loans gathered from original sources. Our results indicate that whereas risk-based capital infusions in Japan...

This paper builds a two-country model with differential productivity and financial frictions to quantitatively account for the recent increase in the U.S. current account deficit. An influential literature says that as U.S. productivity surged, capital was attracted to the United States to take...

In this paper we quantitatively investigate the boom and the bust of the Japanese economy during 1980-2000 using the business cycle accounting technique. This method helps us identify the distortion margins called "wedges" that played a significant role in accounting for the output fluctuations....

A puzzling ambiguity in current international economics literature is the link between sudden stops and output drops. While some studies predict the link, others find sudden stops lead to output increases. This paper theoretically shows that the ambiguity results from alternative preference...