This paper analyzes frameworks for the design of the rules for international trading, assuming that it is possible to have some rule of law. In the Arrow-Debreu benchmark, where there is no economic power and political power is seemingly irrelevant, there is no need for trade agreements - free...

We analyze global dynamics in the standard life-cycle model with production, showing that there can be a plethora of rational expectations dynamics, including "wobbly macro-dynamics". Depending on people's beliefs, the macroeconomy can bounce around infinitely, without converging, without...