In this paper, we use an extended version of the neoclassical multi-country growth model to explore the efficiency in the allocation of physical capital across countries. In our framework, the observed marginal product of capital (MPK) can differ across countries because of two different...

This paper provides a new framework to study the term structure of interest rate spreads and the maturity composition of sovereign bonds. As observed in the literature, sovereign interest rate spreads increase during crises, with short term interest rate spreads rising more than long term...