In this paper, the authors estimate devaluation risk in Denmark, Finland, Norway, and Sweden. The target exchange ra te is modeled as a censored variable, a "shadow peg" that is only observed when the equilibrium floating rate is too far from the prevailing peg. Using a two-step procedure, the...

This article analyses the design of optimal unemployment insurance in a search equilibrium framework where search effort among the unemployed is not perfectly observable. We examine to what extent the optimal policy involves monitoring of search effort and benefit sanctions if observed search is...