This paper provides a comprehensive evaluation of the short-horizon predictive ability of economic fundamentals and forward premia on monthly exchange rate returns in a framework that allows for volatility timing. We implement Bayesian methods for estimation and ranking of a set of empirical...

This paper focuses on the question of income convergence among countries. While the methodology used to determine convergence differs from the common cross-sectional approach, it corroborates Baumol's finding of a convergence club among the world's wealthiest countries. It also shows that there...

Paper reviews India's growth performance since independence. Phrases suchas "Hindu Rate of Growth," sometimes make a telling comment and expose obscureeconomic data to a wider audience, but they can just as readily obscure reality byfocussing attention on the wrong issue. There is nothing in the...

This paper examines the relationship between trade and income convergence by focusing on groups of countries comprising major trade partners. The majority of these groups exhibited significant convergence. Furthermore, a comparison of the trade-based groups with different, randomly selected,...

Many countries, both industrialized and developing, appear to have experienced a slowdown in economic growth. We examine a large sample of countries and find that a majority exhibit a significant structural break in their post-war growth rates. In nearly all of these cases the break was followed...

For decades, the prevailing sentiment among economists was that growth rates remain constant over the long run. Kaldor considered this to be one of the six important `stylized facts' that theory should address, and until the emergence of endogenous growth models, this was a fundamental feature...

Living in a democratic society has been internationally recognized as a basic human right. While most of the literature tries to identify the effect of democracy on economic prosperity, little work has been done to understand the determinants of economic growth under democracy. This paper...

Monetary arrangements in Europe vacillated wildly over the last decade, and they may be expected to continue to do so over the next. The literature on this chaotic process has focused on issues of credibility. Here, we focus instead on the longer-run implications of Europe's choice of monetary...

A model of optimum currency areas is presented using a general equilibrium model with regionally differentiated goods. The choice of a currency union depends upon the size of the underlying disturbances, the correlation between these disturbances, the costs of transactions across currencies,...

We examine the expected survival time of a unilateral exchange rate target zone, when constraints on monetary policy prevent the central bank from exclusively focusing on defending the target zone. In general, the width of the target zone has a negligible effect on the expected survival time,...