This paper analyzes the effects of anticipated inflation on the resource allocations between production and financial services. We develop a model with heterogeneous workers and two sectors economy. A manufacturing sector producing a final composite good and a financial sector providing monetary...

This paper reports first results from a survey of 404 middle-sized and large manufacturing firms from 40 Russian regions in April-June 2003. We examine the extent of social service and infrastructure provision by the firms and the firms’ assessment of the quality of public infrastructure and...

Most economic models implicitly or explicitly assume that interactions between economic agents are 'global' - in other words, each agent interacts in a uniform manner with every other agent. However, localized interactions between microeconomic agents are a pervasive feature of reality. What are...

The paper investigates the relationship between relative price movements and changes in the aggregate price level using monthly data on Finland’s Consumer Price Index and its components from the period covering the past eight and a half years. This was a period of very low inflation. The rate...

Hall (1978) theorized that future consumption could be written only as a function of its current consumption. Since this result is known to be wrong in data, we reexamine, from Flavin's original equations (1981), how they may have reached this conclusion. In the Appendix, we derive a generic...

Recently, there has been a lively debate between Cooper and Willis (2001,2002,2003a, 2003b) and Caballero and Engel (2004) about the apropriateness of the so-called 'gap approach' to labor adjustment. Cooper and Willis claim that the gap approach is unable to identify non- convex adjustment...

IV estimates of the link between profits and investment in the Czech Republic find a complex relationship. While firms may occasionally be credit rationed or face soft budget constraints, investments generally flow to industries with the greatest profit potential or need for recapitalization

The new version of the CGE model of the Slovenian economy, based on the 1998 SAM, was used for simulations of the consequences of further foreign trade liberalization after 1998 as the outcome of the finished processes of implementation of Free Trade Agreements and the European Agreement,...

The large wealth and consumption inequality in the U.S. is usually attributed to two market frictions: debt constraints and incomplete markets. Recent literature has argued that debt constraints are the critical friction while market incompleteness plays only a secondary role. We evaluate the...