Germany has had an extremely low growth performance since 1995. The paper looks at the long-run reasons for this loss of economic dynamics besides German unification: These include leaving labor idle, a declining share of investment in GDP, a weaker innovative activity, an ineffective system for...

Over the past 15 years there has been remarkable progress in the specification and estimation of dynamic stochastic general equilibrium (DSGE) models. Central banks in developed and emerging market economies have become increasingly interested in their usefulness for policy analysis and...

We study the design of optimal monetary policy (Ramsey policies) in a model with sticky prices and unionized labour markets. Collective wage bargaining and unions monopoly power tend to dampen wage fluctuations and to amplify employment fluctuations relatively to a DNK model with walrasian...

The currency crises of the 1990s all exhibit a divergence of the nominal and the real exchange rate together with an increase in the negative current account. The nominal rate does not reflect inflation differences fully and the ensuing real appreciation leads to a negative current account. This...

How can we explain the observed behavior of aggregate inflation in response to e.g. monetary policy changes? Mankiw and Reis (2002) have proposed sticky information as an alternative to Calvo sticky prices in order to model the conventional view that i) inflation reacts with delay and gradually...

This paper proposes an approach for estimating the uncertainty associated with model-based macroeconomic forecasts. We argue that estimated forecast intervals should account for the uncertainty arising from selecting the specification of an empirical forecasting model from the sample data. To...

The paper analyses the interests of China as a member of the G-21, which contributed to the failure of the WTO Ministerial Conference in Cancún/Mexico in September 2003. It concludes that the median member of G-21 is more inward-looking and less reform-minded than China. A failure of the Doha...

Globalization seems to have diminished the importance of geographical distance. However, empirical studies find that distance coefficients in gravity equations change little over time. This paper argues that changes in distance coefficients do not carry much information on changes in distance...

Globalization has affected the integration of markets through many different channels, including movements of factors and trade in goods. From a theoretical point of view, the interaction between the different channels of integration can take different forms. The aim of this paper is to analyze...

Smallholders often have to certify according to international standards and produce under contract for large agro-businesses to access the export market. While mostly positive effects for the farmers have been found for contracts and certifications, little is known about the role of individual...