Following the huge Enron scandal that rocked the financial system of the United States, many firms were asked to restate their accounts by the regulatory authorities. We provide a theoretical model of overstatement in which managers inflate actual profits to attract share capital and...

The concept of factor intensity has played a key role in the development of international trade theory. The factor proportions utilized in the production of commodities differ from activity to activity. Some commodities employ a higher ratio of capital to labor than do others, and the basic...

We use a general equilibrium framework with training costs to characterize a special economic zone which uses foreign capital and local labor. Competitive equilibrium without government intervention leads to "overflow" of local labor in the foreign enclave. A sector-specific wage tax implements...

In this paper, we demonstrate that a foreign capital induced growth in a protected sector, which provides an industrial input for agricultural products, may increase welfare even after the entire foreign capital income is repatriated. Such a policy may lead to an increase in the volume of trade...