worker adjustment. Each worker in our specification can switch either industry, occupation, or both, paying a time … shock …

feature of empirical labor movements); (ii) the economy features gradual and anticipatory adjustment to aggregate shocks; (iii …

thought not, and theory offers ambiguous messages. A hard exchange-rate regime such as the gold standard might limit monetary … shocks if it ties the hands of policy makers. But any decision to forsake exchange-rate flexibility might compromise shock …

controls affect the adjustment of macroeconomic variables to real disturbances? Second, what is the nature of second best …

account adjustment) and intra-temporal trade (goods trade). An economy's response to a shock generally involves a combination …This paper develops a new theory of international economics by introducing Heckscher-Ohlin features of intra … current account adjustment relative to the volume of goods trade, and the slower the speed of adjustment of the current …

flexibility is desirable in the presence of real country-specific shocks that require adjustment in relative prices. However, in …