This paper investigates the role of foreign exchange reserve investment to hedge overall macroeconomic risks. Different from usual micro profit-maximizing purpose, the investment with macro objective is unique in the field of foreign reserve investment. We propose a framework of...

This paper focuses on the duopoly substitutability product with an upstream input subjected to capacity constraints. The effects of capacity constraints are captured. Combining competition effect with constraint effect, some interesting conclusions are reached. First, the relationship between...

We develop a general equilibrium endogenous growth model in which final goods can be produced either in the Non-Observed Economy (NOE) or in the Official Economy (OE). In particular, by solving transitional dynamics numerically towards the unique and stable steady state, we show that, by...

Immigration has long been a hotly debated issue. The core of this debate is immigrants' impact on local job markets. Some people insist that instead of creating more jobs, immigrants actually take away more jobs thus decrease the living standard of natives. Others argue that the presence of...

This paper discusses a portfolio adjusting problem with additional risk assets and a riskless asset in the situation where security returns are given by experts' evaluations rather than historical data. Uncertain variables are employed to describe the security returns. Using expected value and...

It is widely feared that environmental degradation induced by climate change may lead to economic and political insecurity through channels such as resource scarcity and mass migration. In this paper, we have developed an agent-based model to study whether resource scarcity is likely to lead to...

We consider a classical heavy tailed risk model, included in a regulation mechanism. The regulator exercises a minimal cash requirement level and penalties for violating it to regulate the insurance firm. The problem of the insurance firm is to establish an investment and risk exposure policy as...

In macroeconomic literature, it is widely held that persuasion of economic growth and more equitable distribution of income (wealth) is not possible at the same time. The basic reason put forward is that to aim for more equitable distribution will reduce total savings in short and medium terms...

The objective is to show that endogenous discounting models should use a felicity function constrained to a positive domain. A variety of articles use the Mangasarian or Arrow and Kurz condition as a sufficient condition for optimality, which restricts felicity to a negative domain. Since the...

As opposed to institutional investors, individual investors typically have several investment objectives in mind. The traditional utility maximization approach is not only oversimplified but also may not be suitable for real world application. Behavioral asset allocation divides a portfolio into...