In this paper we investigate whether global, local and currency risks are priced in the Finnish stock market using conditional international asset pricing models. We take the view of a US investor. The estimation is conducted using a modified version of the multivariate GARCH framework of De...

In this paper, I provide evidence that currency stop-loss orders contribute to rapid, self-reinforcing price movements, or price cascades. Stop-loss orders, which instruct a dealer to buy (sell) a certain amount of currency at the market rate once the rate has risen (fallen) to a prespecified...

We characterize the equilibrium for a small economy in a dynamic Heckscher-Ohlin model with uncertainty. We show that when trade is balanced period-by-period, the per capita output and consumption of a small open economy converge to an invariant distribution that is independent of the initial...

We set up a dynamic stochastic model of a stylized economy comprising a final output sector (with traditional and modern firms) and an intermediate goods sector. It is shown that market integration reduces the volatility of the rate of return of capital invested in modern firms. The induced...

In the political economy model of Grossman and Helpman (1995), two incumbent governments attempt to negotiate a free trade agreement (FTA), while special interest groups in each country influence negotiations by offering financial contributions to their governments. As a consequence, a set of...

Using a database of 440 international political crises over the period 1918-2002, we find that international crises reduce world market stock returns by approximately four percent per annum. Crises cause large negative stock market reactions in their first month, lower than average returns...

This paper surveys recent contributions on the Internalisation issue, based on different theories of the firm, to show how the make-or-buy decision, at an international level, has been assessed through the opening up of the quot;black boxquot; - traditionally explored by the theorists of the...

When do firms expand abroad? Theory to date suggests that global expansion happens when firm-specific competitive advantages outweigh country-specific difficulties in operating abroad. Differences in culture, in legislation, in administrative practices, and in the overall institutional...

The paper presents an outline of the issues and a preliminary appraisal of the use of trade sanctions by the World Trade Organization (WTO) as a means of promoting compliance by parties. The WTO is unique among intergovernmental organizations (IGOs) in using trade sanctions to enforce...

This paper addresses the role of trade restrictions in support of policies to protect the global environment and proposes a more liberal treatment of these environmental trade measures (ETMs) than that adopted by dispute- settlement panels of the General Agreement on Tariffs and Trade (GATT)....