In this paper we will seek to provide a political economy explanation for the government issuance of indexed bonds. We will show that the issuance of nominal bonds decreases inflation whenever the bondholders' constituency is stronger than the taxpayers' constituency. We then assume that public...

Why do dynamic inconsistencies in monetary policy exist? In this paper we present a traditional model with output inefficiencies, but we allow for monetary policy to be influenced by the various constituencies in the economy, that pressure the Congress to in turn pressure the central bank to...

In this paper we try to construct an hypothesis as to why, as data seem to show, countries that adopt more "transparent procurement", as calculated by the share of tender advertised publicly, are also the ones where corruption is considered more pervasive. We describe an economy where in...

<font size="2" face="CMR10"><font size="2" face="CMR10">This paper analyzes the existing relationship between ethnolinguistic fractionalization, corruption and the growth rate of a country. We provide a simple theoretical model. We show that a non-linear relationship between fractionalization and corruption exists: corruptionis high in homogeneous or...</font></font>

This paper discusses several determinants of the differential between yields on Italian government securities and yields on foreign government securities. We concentrate on expectations of (at least partial) insolvency, tax factors and exchange rate expectations. The evidence suggests that most...

This article provides original evidence on the use of derivatives by sovereign borrowers. Swaps are used both to increase the liquidity of long-term government bonds and for speculation. However, some sovereign borrowers have also used derivatives to "window dress" their public accounts for the...

This paper analyzes the existing relation between corruption and economic growth andexamines the possible outcome of a reform implemented by the State to weed out or reducecorruption. It will be stressed that the reform against corruption tends, if not deemed bythe operators to last in time, to...

A companion volume to the International Handbook on the Economics of Corruption published in 2006, the specially commissioned papers in Volume Two present some of the best policy-oriented research in the field. They stress the institutional roots of corruption and include new research on topics...

Managing Public Debt combines a theoretical and empirical analysis of the advantages of issuing index-linked bonds and potential problems that may arise and how sovereign issuers should deal with them.