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Capital Income Taxation and Risk-Taking in a Small Open Economy
Asea, Patrick K. - 2008
; analysis demonstrates the important role that risk plays in determining the mean and variabilityquot; of growth as well as the … between taxes and risk-taking we estimatequot; a reduced-form multinomial probit model of household portfolio choice using the …
Persistent link: https://www.econbiz.de/10012774930
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Trade, Diffusion and the Gains from Openness
Rodríguez-Clare, Andrés - 2012
Building on Eaton and Kortum's (2002) model of Ricardian trade, Alvarez and Lucas (2005) calculate that a small country representing 1% of the world's GDP experiences a gain of 41% as it goes from autarky to frictionless trade with the rest of the world. But the gains from openness, which...
Persistent link: https://www.econbiz.de/10012755278
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The Simple Analytics of the Melitz Model in a Small Open Economy
Demidova, Svetlana A. - 2011
In this paper we present a version of the Melitz (2003) model for the case of a small economy and summarize its key relationships with the aid of a simple figure. We then use this figure to provide an intuitive analysis of the implications of asymmetric changes in trade barriers and show that a...
Persistent link: https://www.econbiz.de/10013119344
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Growth and Welfare in a Small Open Economy
Grossman, Gene M. - 2010
We construct a model of growth based on endogenous technological change in a small, open economy. Entrepreneurs develop new intermediate products whenever the present value of potential profits exceeds the cost of R&D. Diversity of intermediates contributes to total factor productivity in the...
Persistent link: https://www.econbiz.de/10013139328
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Investment Tax Credit in an Open Economy
Sen, Partha; Turnovsky, Stephen J. - 2022
This paper contrasts the effects of a permanent and temporary investment tax credit in an open economy. In both cases an ITC will initially stimulate investment, while reducing employment and output, and generating a current account deficit. If the ITC is permanent, the accumulation of capital...
Persistent link: https://www.econbiz.de/10013309580
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International Trade and Open Access Renewable Resources : The Small Open Economy Case
Brander, James A.; Taylor, M. Scott - 2021
This paper develops a two-sector general equilibrium model of an economy with an open access renewable resource. We characterize the autarkic steady state, showing that autarky prices (and 'comparative advantage') are determined by the ratio of intrinsic resource growth to labor. Under free...
Persistent link: https://www.econbiz.de/10013238708
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Optimal Monetary Policy in Closed Versus Open Economies : An Integrated Approach
Clarida, Richard; Galí, Jordi; Gertler, Mark - 2021
This paper develops a new open economy macro model of optimal monetary for a small open economy. Our main result is that in this model, the optimal policy problem for the small open economy is isomorphic to the closed economy case studied in Clarida, Gali, Gertler (1999). In particular, the...
Persistent link: https://www.econbiz.de/10013252299
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The Empirics of Monetary Policy Rules in Open Economies
Clarida, Richard - 2021
This paper was prepared as a Keynote Address for the ESRC Conference on the Future of Macroeconomics held at the Bank of England Conference Center on April 14, 2000. It uses the empirical framework for formulating and estimating forward looking monetary policy rules developed in Clarida, Gali,...
Persistent link: https://www.econbiz.de/10013220781
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Safe Assets
Barro, Robert J. - 2014
. However, in a Lucas-tree world, the aggregate risk is given by the process for GDP and cannot be altered by the creation of … will be nil. With heterogeneity in coefficients of relative risk aversion, safe assets can take the form of private bond … issues from low-risk-aversion to high-risk-aversion agents. The model assumes Epstein-Zin/Weil preferences with common values …
Persistent link: https://www.econbiz.de/10013044613
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Can Structural Small Open Economy Models Account for the Influence of Foreign Disturbances?
Justiniano, Alejandro - 2010
This paper demonstrates that an estimated, structural, small open economy model of the Canadian economy cannot account for the substantial influence of foreign-sourced disturbances identified in numerous reduced-form studies. The benchmark model assumes uncorrelated shocks across countries and...
Persistent link: https://www.econbiz.de/10012758033