A basic assumption of the gravity equation of international trade is that increasing trade costs lower exports. Butintuition and theory imply that a high export volume lowers bilateral trade costs as well, because a fixed cost intensivetrade sector probably bears lower average costs with more...

The process of wage determination is mediated by the institutional framework of the labor market. Bargaining systems differ not only in their mode of governance, but also in the way that wages are related to unemployment, inflation, and productivity growth. Based on annual data for the period...

Panel data analysis has become very popular in comparative political economy. However, in order to draw meaningful inferences from such data, one has to address specification and estimation issues carefully. This paper aims to demonstrate various pitfalls that typically occur in applied...

Already before the final introduction of the single European currency there have been negotiations on a further enlargement of the Eurozone to the East. The accession of 10 Central and Eastern European Countries (CEEC) to Euroland is likely to be realised within the next 10 years and it is an...

Rational partisan theory of political business cycles suggests differences in inflation under left-wing and right-wing governments. It also suggests temporary post-electoral booms after election of left-wing governments and temporary recessions after election of right-wing ones. However, the...