This paper investigates how an increase in the United States Federal Fund rate affects the United States economy and how the effects are transmitted to the Canadian economy using the factor-augmented VAR (FAVAR) approach of Stock and Watson (2005) and Bernanke et al. (2005). A distinguishing...

In this paper a factor-augmented vector autoregressive (FAVAR) model is estimated to characterize the dynamic effects of shocks in the personal income tax rate in the United States on United States and Canadian economies. The representation and the estimate of the FAVAR model is based on Stock...

This paper develops a duopoly model of vertical product differentiation where two domestic firms incur variable costs of quality development. These domestic firms can purchase a superior foreign technology through licensing. Outcomes between Bertrand and Cournot competition are compared. We find...

The New Keynesian Phillips Curve (NKPC) was developed as a response to the New Classical critique that Keynesian macroeconomics lacked micro-foundations. The NKPC provides theoretical micro-foundations that attempt to explain, inter alia, nominal rigidities and, explicitly price stickiness. This...

Using an endogenous growth model, this paper examines the growth and welfare effects of foreign aid in the recipient economy. The emphasis is on the incentive factor of the effort–leisure choice. Besides financing public services, part of the aid is transferred to the public. This increases...

In developing countries of tourist destinations, an increase in medical tourism raises the wages in the medical tourism sector, thereby retaining skilled medical workers who otherwise leave the country. However, the expansion of medical tourism contracts the domestic healthcare services sector,...

This paper examines the effects of currency devaluations on goods prices and foreign reserves for a small-open economy with inbound tourism. Tourism transforms non-traded goods into exportable goods. Devaluations yield an over pass-through to the prices of the non-traded tourism goods. This may...