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We live in a new world economy characterized by financial globalization and historically low interest rates. This … in this world. The interest-rate and terms-of-trade spillovers produce policy externalities that make the noncooperative …
Persistent link: https://www.econbiz.de/10011165132
We study a dynamic economy where credit is limited by insufficient collateral and, as a result, investment and output are too low. In this environment, changes in investor sentiment or market expectations can give rise to credit bubbles, that is, expansions in credit that are backed not by...
Persistent link: https://www.econbiz.de/10010751327
We reconsider the empirical links between volatility and growth between 1970 and 2007. There is a strong and significant correlation between individual country growth rates and global factors that are arguably exogenous with respect to their economies. The amount of volatility driven by these...
Persistent link: https://www.econbiz.de/10005037715
We study the impact of information and communication technology on growth through its impact on organization and innovation. Agents accumulate knowledge through two activities: innovation (discovering new technologies) and exploitation (learning how to use the current technology). Exploitation...
Persistent link: https://www.econbiz.de/10005580091
This expository paper describes major developments during the second decade of rational-expectations macroeconomics, roughly 1982-1991. Topics attracting the most attention from researchers differed from those of 1972-1981, with considerable emphasis being devoted to technical mailers. Here the...
Persistent link: https://www.econbiz.de/10005829272
We develop a stylized model of economic growth with bubbles. In this model, financial frictions lead to equilibrium dispersion in the rates of return to investment. During bubbly episodes, unproductive investors demand bubbles while productive investors supply them. Because of this, bubbly...
Persistent link: https://www.econbiz.de/10008634704
We explore a view of the crisis as a shock to investor sentiment that led to the collapse of a bubble or pyramid scheme in financial markets. We embed this view in a standard model of the financial accelerator and explore its empirical and policy implications. In particular, we show how the...
Persistent link: https://www.econbiz.de/10008680938
Does news about future productivity cause business-cycle fluctuations? What other effects might it have? We explore the answer to this question using semi-structural VARs, where “news” is defined as the innovation in the expectation of TFP at a fixed horizon in the future. We find that...
Persistent link: https://www.econbiz.de/10011271450
In the early twentieth century, education legislation was often passed based on arguments that new laws were needed to force immigrants to learn English and "Americanize." We provide the first estimates of the effect of statutes requiring English as the language of instruction and compulsory...
Persistent link: https://www.econbiz.de/10010950834
An important criticism of race-based higher education admission preferences is that they may hurt minority students who attend more selective schools than they would in the absence of such preferences. We categorize the non-experimental research designs available for the study of so-called...
Persistent link: https://www.econbiz.de/10005580304