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The Exchange Rate - A Shock-Absorber or Source of Shocks? A Study of Four Open Economies

Artis, Michael J; Ehrmann, Michael - C.E.P.R. Discussion Papers - 2000

examine the idea that an independent money and exchange rate should allow for effective shock-absorption. A polar extreme …

Persistent link: https://www.econbiz.de/10005789208

On the Distribution of Exchange Rate Regime Treatment Effects on International Trade

Dorn, Sabrina; Egger, Peter - C.E.P.R. Discussion Papers - 2011

This paper provides evidence of heterogeneous treatment effects on trade from switching among three types of de-facto exchange rate regimes: freely floating, currency bands, and pegs or currency unions. A cottage literature at the interface of macroeconomics and international economics focuses...

Persistent link: https://www.econbiz.de/10009365643

Understanding Exchange Rate Volatility Without the Contrivance of Macroeconomics

Flood, Robert P; Rose, Andrew K - C.E.P.R. Discussion Papers - 1998

Exchange rate regimes differ primarily by the activity of the exchange rate, not observable macroeconomic ‘fundamentals’. Fixed exchange rates are typically stable and floating exchange rates are volatile, but macro phenomena are regime-independent. Fundamentals only seem to be relevant for...

Persistent link: https://www.econbiz.de/10005788957

Perfectly Competitive Innovation

Boldrin, Michele; Levine, David - C.E.P.R. Discussion Papers - 2002

We construct a competitive model of innovation and growth under constant returns to scale. Previous models of growth … under constant returns cannot model technological innovation. Current models of endogenous innovation rely on the interplay … innovation and sees the non-rivalrous nature of ideas as a natural conduit to increasing returns. The results here challenge the …

Persistent link: https://www.econbiz.de/10005661529

Structural Change and the Kaldor Facts of Economic Growth

Foellmi, Reto; Zweimüller, Josef - C.E.P.R. Discussion Papers - 2002

We present a model in which two of the most important features of the long-run growth process are reconciled: the massive changes in the structure of production and employment; and the Kaldor facts of economic growth. We assume that households expand their consumption along a hierarchy of needs...

Persistent link: https://www.econbiz.de/10005792315

Spatial Development

Desmet, Klaus; Rossi-Hansberg, Esteban - C.E.P.R. Discussion Papers - 2009

We present a theory of spatial development. A continuum of locations in a geographic area choose each period how much to innovate (if at all) in manufacturing and services. Locations can trade subject to transport costs and technology diffuses spatially across locations. The result is an...

Persistent link: https://www.econbiz.de/10008566320

Testing a DSGE Model of the EU Using Indirect Inference

Meenagh, David; Minford, Patrick; Wickens, Michael R. - C.E.P.R. Discussion Papers - 2008

We use the method of indirect inference, using the bootstrap, to test the Smets and Wouters model of the EU against a VAR auxiliary equation describing their data; the test is based on the Wald statistic. We find that their model generates excessive variance compared with the data. But their...

Persistent link: https://www.econbiz.de/10005791817

Pitfalls in Estimating Asymmetric Effects of Energy Price Shocks

Kilian, Lutz; Vigfusson, Robert J. - C.E.P.R. Discussion Papers - 2009

A common view in the literature is that the effect of energy price shocks on macroeconomic aggregates is asymmetric in energy price increases and decreases. We show that widely used asymmetric vector autoregressive models of the transmission of energy price shocks are misspecified, resulting in...

Persistent link: https://www.econbiz.de/10005000442

Law Enforcement and Transition

Roland, Gérard; Verdier, Thierry - C.E.P.R. Discussion Papers - 2000

We present a simple model to analyse law enforcement problems in transition economies. Law enforcement implies coordination problems and multiplicity of equilibria due to a law abidance and a fiscal externality. We analyse two institutional mechanisms for solving the coordination problem. A...

Persistent link: https://www.econbiz.de/10005504479

The Clan and the City: Sustaining Cooperation in China and Europe

Greif, Avner; Tabellini, Guido - C.E.P.R. Discussion Papers - 2012

Over the last millennium, the clan and the city have been the locus of cooperation in China and Europe respectively. This paper examines - analytically, historically, and empirically - the cultural, social, and institutional co-evolution that led to this bifurcation. We highlight that groups...

Persistent link: https://www.econbiz.de/10011084470