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

two-way trade in differentiated products. The findings are consistent with the "smooth adjustment" hypothesis. Anti …

This paper reconciles the persistence of aggregate real exchange rates with the faster adjustment of international … stylized facts regarding this puzzle. First, adjustment to purchasing power parity deviations in aggregated data is not just a … slower version of adjustment to the law of one price in microeconomic data, as arbitrage occurs in different markets, in …

We find evidence of threshold behavior in current account adjustment for the G7 countries, such that the dynamics of … adjustment towards equilibrium depend upon whether the current-account/ net-output ratio breaches estimated, country specific … current account surplus or deficit thresholds. Both the speeds of adjustment and the size of the thresholds are found to …

, econometric partial adjustment models perform relatively well at the aggregate level. Analyzing the classic employment adjustment … problem, we show how discrete and occasional microeconomic adjustment is well described by a new form of partial adjustment … discrete and occasional adjustment at the micro level, where production units are essentially restricted to either operate with …