subject to self-fulfilling variations in the world real interest rate. Those expectation-driven changes in the borrowing cost … asset prices, GDP, consumption, investment and employment). When firms around the world benefit from unexpectedly low debt … internationally. Such a stylized model thus offers one way to rationalize both the existence of world business-cycle factor documented …

capital flows accounting framework consisting of the U.S., Western Europe, and the Rest of the World, is developed to identify … international capital flows. Counterfactual analyses show world output would have been 0.6% higher had there been perfect capital … mobility, and that these impediments to capital mobility raised welfare substantially in the rest of the world and modestly in …

€™s potential welfare gain from moving to a world with frictionless trade. In this model, a country’s trade potential depends on …