This paper examines the impact of monetary policy on UK firms’ access to bank and market finance whenallowance is made for differences in firm-specific characteristics. A theoretical model determines the cut-off valuesfor project profitability that would allow firms to access bank or market...

This paper investigates the role of trade credit in the transmissionof monetary policy. Most models of the transmission mechanism allowthe firm to access only financial markets or bank lending according tosome net worth criterion. In our model we introduce trade creditas an additional source of...

The relationship between inflation and the relative variability of prices has been the subject ofcareful investigation in the US using data for product groups at the city level. Yet in Europe,where the relationship could have profound effects on the viability of monetary integration, noattempt...

This series evidence has been used to analyse the effect of trade on foreign holdings of domesticcurrency. Here we extend a model of currency substitution that incorporates a trade motive forforeigners to hold domestic currency. It uses time series and cross-sectional information for apanel of...

We test for mean reversion in real exchange rates using data from five countries, four of whichhave experienced episodes of high inflation. We use monthly data for Argentina, Brazil, Chile,Colombia and Israel from 1972 to 1993 and find that in all cases except Brazil a stochastic unitroot model...