Recent theories on the origins of crises put lending booms at the root of financial collapses. Yet lending booms may be a natural consequence of economic development and fluctuations. So, are lending booms dangerous? In this Paper, we investigate this question empirically using a broad sample of...

This paper explores the implications of public investment for macroeconomic performance within a simple two-period policymaking model. We show that under the balanced-budget rule, the contribution of public investment to future output plays a key role in determining its effects on macroeconomic...

We analyse the importance of ERM membership for macroeconomic performance by comparing the behaviour of real output growth and inflation of members and non-members of the ERM. Taking the traditional aggregate supply and demand model as the basis for the analysis, we propose and implement an...

Political risk is widely present in developing but also in developed countries, and stems from a variety of sources. The objective of this paper is twofold. First, we develop a theoretical model to investigate the impact of political risk on irreversible investment. Second, we apply our model to...

What is the impact of Chinese import competition on Nordic producer prices? In a panel covering 23 (2 digit) NACE manufacturing sectors from 1995 to 2008, instrumental variable estimations predict that when Chinese imports capture a 1% increase in market share, Nordic producer prices decrease by...