This paper is the first application of the singular value decomposition in general equilibrium theory. Every technology matrix can be decomposed into three parts: (1) a definition of composite commodities; (2) a definition of composite factors; and (3) a simple map of composite factor prices...

The large and persistent deviations of nominal exchange rates from their purchasing power parities comprise a key stylized fact in international economics. This paper sheds light on these persistent deviations by combining two disparate strands of empirical work. The first strand focuses on real...