between risk and uncertainty is implemented by applying the Gilboa-Schmeidler maxmin with multiple priors framework to lenders …, ultimate lenders and financial intermediaries. The model is used to investigate the impact of uncertainty about the likelihood … include: (i) An unanticipated increase in bailout uncertainty raises interest rates, the volume of defaults in both the real …

Firms in many developing countries cite macroeconomic instability and political uncertainty as major constraints to … their growth. Economic theory suggests uncertainty can cause firms to delay investments until uncertainty is resolved. We … macroeconomic and political uncertainty. Demand for macroeconomic shock insurance was high; 36.7 percent of microentrepreneurs in …

We study the effects of changes in uncertainty about future fiscal policy on aggregate economic activity. Fiscal … consolidation inevitable, there is considerable uncertainty about the policy mix and timing of such budgetary adjustment. To … evaluate the consequences of this increased uncertainty, we first estimate tax and spending processes for the U.S. that allow …

consensus. Our model deepens the discussion of economic risk and political risk in fiscal federalism, and highlights the related …

political uncertainty commands a risk premium whose magnitude is larger in poorer economic conditions. Political uncertainty …We study the pricing of political uncertainty in a general equilibrium model of government policy choice. We find that …

, uncertainty makes reforms more politically viable and may, under some conditions, increase social welfare. The model is then used … uncertainty is associated to more reforms in a panel of 20 OECD countries. …

We analyze how changes in government policy affect stock prices. Our general equilibrium model features uncertainty … average. The price fall is expected to be large if uncertainty about government policy is large, as well as if the policy … change is preceded by a short or shallow downturn. Policy changes increase volatility, risk premia, and correlations among …

We study how the labour market and industry uncertainty affect the investment decisions of multinational enterprises … industries. Differences in risk may draw MNEs to different locations. Firm-specific bargaining always offers an advantage, as the … mix of current and future pay fully reflects the firm’s risk profile. …