Carlsson and van Damme (1991, 93) presented a notion of a global game, which is an incomplete information game where the actual payoff structure is affected by a realization of a common shock and where each player gets noisy private information of the shock. For n -person symmetric games with...

This paper studies determinants of the decision to invest abroad. Among them, we follow the current mainstream theory of foreign direct investment so as to emphasize the stock of technological knowledge. We explicitly solve the optimal geographical composition(i.e. domestic vs. abroad) of the...

As economic integration in East Asia progresses, trade patterns within the region are displaying an ever-greater complexity: Though inter-industry trade still accounts for the majority, its share in overall trade is declining. Instead, intra-industry trade (IIT), which can be further divided...

Characteristics of business cycles are quite different across developed countries. As Gordon (1982) pointed out, in the United States real wages and the adjustment of working hours are less flexible than in Britain and Japan. Using a business cycle model with microeconomic foundation, this paper...

We provide an econometric analysis of whether or not the tariff preferences extended to Canada and Mexico under NAFTA may have resulted in trade diversion. A review of previous studies, both descriptive and econometric, suggests that trade diversion has occurred especially as evidenced by...

This paper attempts to integrate the theory of trade with that of capital movements, and to study the two country world where each nation has a different rate of time preference. It resolves the indeterminacy problem intrinsic in the Heckscher-Ohlin model where trade and factor movements coexist...

This paper is consideration of strategic aspects of national saving policies in a game theory setting. In pure exchange economy involving two countries, each government chooses a future time path of the national consumption-wealth ratio in order to maximize its citizens' utility. When private...

Using micro-data of the Establishment and Enterprise Census, we compile new statistics on the employment of Japanese affiliates of foreign firms at the 3-digit industry level for the year 1996. We find that the existing official statistics severely underestimate inward FDI. Nevertheless, the...