In this paper, we propose a dynamic error-components model to represent the unobserved level of technology. This specification implies a well-defined common factor dynamic model for per capita output that can be tested explicitly. The model is applied to data on aggregates of agricultural inputs...

In this paper, we study the link between real exchange rate (RER) depreciation and elections in Latin America. Our contribution is threefold. First, we employ a statistical model that takes into account the pervasive conditional heteroskedasticity found in financial data and includes a wide...

This paper extends Andrews' [1993] median-unbiased estimation for autoregressive/unit root time series to panel data dynamic fixed effects models. It is shown that median-unbiased estimation applies straightforwardly to models that include linear time trends as well as to those including more...

We estimate a small-scale macro model for the Mexican economy under the New Keynesian (NK) framework and alternative interest rate rules for Mexico. With these results we evaluate the performance of the Bank of Mexico against a set of optimality principles derived in the NK literature. Our...