Uncertainty about the riskiness of new financial products was an important factor behind the U.S. credit crisis. We show that a boom-bust cycle in debt, asset prices and consumption characterizes the equilibrium dynamics of a model with a collateral constraint in which agents learn ""by...

The paper examines the slowdown of lending by large U.S. banks over the period 2007Q3 - 2009Q2, focusing on: (i) whether capital or liquidity was the binding constraint; (ii) factors influencing banks’ decision to hold capital; and (iii) their pricing behavior. Using quarterly data for the...

We estimate international technology spillovers to U.S. manufacturing firms via imports and foreign direct investment (FDI) between 1987 and 1996. In contrast to earlier work, our results suggest that FDI leads to substantial productivity gains for domestic firms. The size of FDI spillovers is...

The paper discusses the fiscal impact of the Great Recession of 2007-08 on state and local governments in the United States. It documents the sharp decline in tax revenue and discusses how states responded to close the budget gaps in order to obey the balanced budget provisions. It highligts the...

The increase in the U.S. public debt over the past twelve years raises questions about its implications for investment and economic growth. This paper places these developments within an international and historical context and quantitatively examines the implications of various measures of the...

The factors underlying the rise in U.S. income inequality since the mid-1970s are examined. The results suggest that the trend increase in income inequality has not been related to macroeconomic developments, such as income growth or import penetration, but that the income distribution is...

The paper investigates how changes in industries'' funding costs affect total factor productivity (TFP) growth. Based on panel regressions using 31 U.S. and Canadian industries between 1991 and 2007, and using industries'' dependence on external funding as an identification mechanism, we show...

This paper uses the financial crisis of 2008 as a natural experiment to demonstrate that when measuring investment-cash flow sensitivity, the value of a firm's assets that can be used as collateral should be taken into account. Using panel data on U.S. firms from 1990 to 2011, it was found that...

This book contributes to the discussion on wisdom in management, leadership and strategy by developing a unique theoretical approach. Integrating rational-analytical, intuitive and philosophical dimensions of wise decision-making, it advocates a broadly Platonic-Socratic view on wisdom. Applying...

This book argues that the strength of our dynamic society is a market economy, which functions well only if positive and constructive marketing practices are performed. It offers innovative alternatives for achieving economic progress and outlines strategies to create conditions for equal...