The empirical evidence presented in this paper casts serious doubts on the by now widely accepted "stylized facts" of the exchange rate based stabilization programs (ERBS) as they are stated in Kiguel and Liviatan (1992) and in Végh (1992). Even though the ERBS programs were associated with...

I characterize games for which there is an order on strategies such that the game has strategic complementarities. I prove that, with some qualications, games with a unique equilibrium have complementarities if and only if Cournot best-response dynamics has no cycles; and that all games with...

The empirical evidence presented in this paper casts doubts on the by now widely accepted "fact"that the exchange rate based stabilization programs are expansionary. Even though these programs were associated with output booms, no evidence of booms caused both by the stabilization programs is...

We study the behavioral denition of complementary goods: if the price of one good increases, demand for a complementary good must decrease. We obtain its full implications for observable demand behavior (its testable implications), and for the consumer's underlying preferences. We characterize...

I prove the subgame-perfect equivalent of the basic result for Nash equilibria in normal-form games of strategic complements: the set of subgame-perfect equilibria is a non-empty, complete lattice. For this purpose I introduce a device that allows the study of the set of subgame-perfect...

This paper formalizes the relation between comparative statics and the out-of-equilibrium explanation for how a system evolves after a change in parameters. The paper has two main results. First, an increase in an exogenous parameter sets o learning dynamics that involve larger values of the...

Changes in the parameters of an n-dimensional system of equations induce changes in its solutions. For a class of such systems, we determine the qualitative change in solutions given certain qualitative changes in parameters. Our methods and results are elementary yet useful. They highlight the...

This paper develops a non-linear DSGE model to assess the interaction between ex-post interventions in credit markets and the build-up of risk ex ante. During a systemic crisis, bailouts relax balance sheet constraints and mitigate the severity of the recession. Ex ante, the anticipation of such...

This paper proposes a theoretical model which incorporates capital accumulation and spatial spillovers across economies, while allowing for differences in absorptive abilities. This model is later estimated for a sample of 215 European NUTS2 regions, before and after the last enlargement of the...

Economic literature has examined the impact of education and factors endowment on individual preferences towards free-trade and immigration by focusing on the sign of an interaction term between the educational level and the Gross Domestic Product per capita. The aim of this paper is to...