The paper presents a monetary policy model with an endogenous capital stock when a backward looking element in wage setting causes inflation persistence. We analyse how the endogeneity of the capital stock changes the macroeconomic dynamics with which policy interacts and its implications for...

An observer makes a number of observations of an industry producing a homogeneous good.  Each observation consists of the market price, the output of individual firms and perhaps information on each firm's production cost.  We provide various tests (typically, linear programs) with which the...

The single crossing property plays a crucial role in monotone comparative statics (Milgrom and Shannon (1994)), yet in some important applications the property cannot be directly assumed or easily derived.  Difficulties often arise because the property cannot be aggregated: the sum of two...

Whether they are financial, economic, or psychological, discount rates affect most economic decisions: investment and savings, hirings and firings, defaults and refinancing, financial and economic reforms, learning and experimentation, and any other decision with long-term consequences, such as...

We consider an observer who makes a finite number of observations of an industry producing a homogeneous good, where each observation consists of the market price and firm specific production quantities.  We develop a revealed preference test (in the form of a linear program) for the hypothesis...

We focus on the management of highly persistent shocks to aid flows, including HIPC or MDG-related increases in net flows, in the presence of currency substitution by the domestic private sector. Such shocks have beneficient long-run effects, but when currency substitution is high they can...

Opportunist land encroachment, resulting from costly and incomplete enforcement of common land boundaries, is a problem in many less-developed countries. A multi-period model of such encroachment is presented in this paper. The model accounts explicitly for the cumulative effects of...

This note determines the precise connection between an agent`s attitude towards income risks and his attitude over risks in the underlying consumption space. Our results follow a general mathematical theory connecting the curvature properties of an objective function with the ray-curvature...