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Contracts and Money
Jovanovic, Boyan - 1996
We analyze the contractual relation between workers and their employers when there is nominal risk. The key feature of … eliminate all nominal risk for the parties (by fully indexing the terms of the contracts to the price level) but they would be …
Persistent link: https://www.econbiz.de/10012473208
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Dynamic Incentive Contracts Under Parameter Uncertainty
Prat, Julien - 2010
Commitment is therefore more valuable when quality is known more precisely. Incentives then are easier to provide because the agent has less room to manipulate the beliefs of the principal. Moreover, in contrast to results under one-period commitment, wage volatility declines as experience...
Persistent link: https://www.econbiz.de/10012462007
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Implications for the Adjustment Process of International Asset Risks : Exchange Controls, Intervention and Policy Risk, and Sovereign Risk
Buiter, Willem H. - 1980
country risk, the paper discusses a number of modifications in the standard theory of efficient international financial … markets that are necessitated by the existence of country risk., For macroeconomic policy, the major implications are that …
Persistent link: https://www.econbiz.de/10012478620
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Uncertainty and Growth Disasters
Jovanovic, Boyan - 2020
This paper documents several facts on the real effects of economic uncertainty. First, higher uncertainty is associated with a more dispersed distribution of output growth. Second, the relation is highly asymmetric: A rise in uncertainty is associated with a sharp decline in the lower tail of...
Persistent link: https://www.econbiz.de/10012482243
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Trading on Sunspots
Jovanovic, Boyan - 2014
In a model with multiple Pareto-ranked equilibria we add trade in assets that pay based on the realization of a sunspot. Asset trading restricts the equilibrium set in a way that raises welfare by eliminating equilibria with a high likelihood of disasters. When the probability of a disaster is...
Persistent link: https://www.econbiz.de/10012457853
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The Fallacy of the Fiscal Theory of the Price Level
Buiter, Willem H. - 1999
or unsound argument'. The 'fiscal theory of the price level', recently re-developed by Woodford, Cochrane, Sims and … proponents of the fiscal theory of the price level do not accept the fundamental proposition that the government's intertemporal …. Policy conclusions could be drawn from the fiscal theory of the price level that would be harmful if they influenced the …
Persistent link: https://www.econbiz.de/10012471482
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Liquidity Traps : How to Avoid Them and How to Escape Them
Buiter, Willem H. - 1999
The paper considers ways of avoiding a liquidity trap and ways of getting out of one. Unless lower short nominal interest rates are associated with significantly lower interest volatility, a lower average rate of inflation, which will be associated with lower expected nominal interest rates,...
Persistent link: https://www.econbiz.de/10012471545
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Fiscal Prerequisites for a Viable Managed Exchange Rate Regime : A Non-technical Eclectic Introduction
Buiter, Willem H. - 1986
borrowing. There is not yet any "deep structural" theory justifying the (exogenous) lower bounds on the stock of foreign … exchange reserves characteristic of the collapsing exchange rate literature. Absent such a theory of "international liquidity …
Persistent link: https://www.econbiz.de/10012477028
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Death, Population Growth, Productivity Growth and Debt Neutrality
Buiter, Willem H. - 1986
Debt neutrality is said to occur if, given a program for public spending on current goods and services over time, the real equilibrium of the economy (private consumption, investment, relative prices, etc.) is independent of the pattern of government borrowing and lump-sum taxation over time....
Persistent link: https://www.econbiz.de/10012477043
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Structural and Stabilization Aspects of Fiscal and Financial Policy in the Dependent Economy
Buiter, Willem H. - 1986
The paper considers the response of a small, open dependent economy to a variety of fiscal and financial shocks as well as the influence of alternative budget balancing rules on the response of the system to such external shocks as a change in the world interest rate. The approach allows for...
Persistent link: https://www.econbiz.de/10012477047